Apco Oil and Gas International Inc. (NASDAQ:APAGF) reports that the Argentine province of Rio Negro has agreed to extend the concession term for the company’s operation in the Entre Lomas concession for 10 years. The Entre Lomas concession is extended to Jan. 21, 2026.
Under the extension, Apco will pay a net bonus of $7.9 million in January 2015 and spend approximately $57.6 million for exploitation, exploration and public works commitments during the remainder of the concession term. In addition, the provincial production tax increases was increased from the current level of 12% to 15% beginning this month.
The Entre Lomas concession currently produces approximately 5,600 gross barrels of oil per day and 19.5 million gross cubic feet of natural gas per day in the province of Rio Negro.
Apco has a 23% direct participation interest in the Entre Lomas concession and a total combined direct and equity participation in the concession of 52.79% including its 40.72% stock ownership interest in Petrolera Entre Lomas SA.
Petrolera holds a 73.15% direct participation interest and is the operator of the Entre Lomas concession.