FAR Limited has announced it has entered into an RSSD Sale and Purchase Agreement with ONGC Videsh Vankorneft Pte Ltd (ONGC) in respect of FAR’s entire interest in the Production Sharing Contract for the Rufisque, Sangomar, and Sangomar Deep Offshore Blocks offshore Senegal and the relevant Joint Operating Agreement (the RSSD Project). ONGC Videsh Vankorneft is a subsidiary of ONGC Videsh, the largest E&P company of India.

As consideration for the sale, ONGC has agreed to pay FAR US$45 million at completion. In addition, ONGC has agreed to reimburse FAR’s share of working capital for the RSSD Project from 1 January 2020 totalling US$66.58 million, payable on completion. The reimbursement is comprised of cash calls paid by FAR, including US$29.60 million paid to cure FAR’s default to the Joint Venture. The Transaction also includes an entitlement to certain contingent payments capped at US$55 million as outlined below.

Under the Transaction, FAR is proposing to sell to ONGC its interest in the RSSD Project, being:
 a 13.67% participating interest in the Sangomar exploitation area containing the Sangomar field; and
 a 15% participating interest in the RSSD contract area outside the Sangomar exploitation area

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Source: OilnewsKenya