Taipan Resources Inc. (TSX-V:TPN) ("Taipan" or the "Company"), through its wholly-owned Kenya-based subsidiary Lion Petroleum Corp. "Lion"), has completed the previously announced farmout agreement with Premier Oil Investments Limited ("Premier"), a subsidiary of Premier Oil plc (LSE:PMO), whereby Premier has acquired a 55% participating interest in Block 2B onshore Kenya. Taipan retains a 45% interest and operatorship during the exploration phase in Block 2B.
Under the terms of the farmout agreement Premier will carry Taipan through the cost of the work program for the First Additional Exploration Period totalling a gross cost of up to $29.5mm. This includes the drilling and testing of the Pearl-1 prospect that is estimated to have gross prospective resources of 200 million barrels of oil (mmbbls). The remaining lead inventory on Block 2B in addition to Pearl-1 is capable of delivering in excess of 500 mmbbls gross.
Premier will also provide a guarantee for the minimum work and expenditure obligations for the First Additional Exploration Period on Block 2B of US$13 million and will pay Taipan $1 million in back costs.
Taipan will retain operatorship of Block 2B during the exploration phase with Premier having the right to assume operatorship of any development.
Mr. Maxwell Birley commented, ""We look forward to working with Premier Oil, a company with a strong track record of exploration and development success. The Pearl-1 exploration well is targeting a Tertiary prospect similar to Tullow's Ngamia, Twiga, Ekales and Agete discoveries. The Company also has multiple prospects similar to Tullow's Eutko discovery. The Anza Basin is one of the largest Tertiary-age rift-basins of the East African Rift systems that together contain multi-billion barrel oil discoveries. We believe that the 'sweet spot' of the Anza Basin is located on Block 2B."