• Ministry of Petroleum and Energy, The Gambia approves assignment of 40% interest to PETRONAS in Blocks A2 and A5
• FAR retains 40% equity in Blocks A2 and A5 and Operatorship
• FAR to receive cash proceeds comprising back cost reimbursements and consideration totalling A$19M as at end June 2018
• PETRONAS and FAR plan to drill the Samo-1 well in late 2018 targeting a prospective resource of 825mmbbls 

The Government of The Republic of The Gambia in West Africa has approved the assignment by FAR Gambia Ltd of a 40% interest in petroleum licences for offshore Blocks A2 and A5 in The Gambia to a subsidiary of Petroliam Nasional Berhad (“PETRONAS”).

Under the terms of the farm-out agreement executed in February 2018, PETRONAS will fund 80% of the exploration well costs of the Samo-1 well up to a maximum total gross cost of US$45.0 million. In addition to the well costs, PETRONAS will pay FAR cash consideration of US$6 million plus 80% of nonwell back costs. The proceeds are subject to reconciliation and were estimated to be A$19 million at 30 June 2018. PETRONAS acquires a 40% working interest with FAR retaining 40% of its original 80% interest.

FAR’s Managing Director Cath Norman said, 
“By securing the approval of The Gambian Ministry of Petroleum and Energy, FAR has achieved another milestone towards its objective of drilling the substantial oil resource potential of the highly prospective Blocks A2 and A5 in The Gambia.

We again thank the Gambia Ministry of Petroleum and Energy, the Gambia National Petroleum Company (GNPC), the Government of the Gambia and our broader Gambian stakeholders and look forward to working with them to drill Gambia’s first exploration well since 1979 with our coventurer, PETRONAS.”

FAR has secured a contract with a subsidiary of Stena Drilling who will provide and operate the Stena DrillMAX drillship to drill the Samo-1 well in late 2018. FAR estimates the Samo prospect contains prospective resources of 825mmbbls oil.