STEPHENVILLE Enegi Oil Plc has signed a Letter of Intent with Black Spruce Exploration Corp. for the development of Enegi‚Äôs lease and licence in western Newfoundland.
Enegi is an independent oil and gas company with assets located in the UK North Sea, Newfoundland, Ireland, and Jordan.
The two companies intend to enter into a definitive farm-in agreement by July 12 that will result in the drilling of a number of wells and accelerate development of the Enegi‚Äôs Newfoundland assets.
As part of the farm-in agreement, Black Spruce Exploration will be required to drill three appraisal and development wells, and two exploration wells at Garden Hill on the Port au Port Peninsula.
Black Spruce will be required to drill seven further wells to increase its interest to earn a 60 per cent working interest in all the lease and licences held by Enegi.
Three of these well locations are being identified by Enegi while the remaining four will be identified by Black Spruce.
The two companies will also agree an area of mutual interest covering certain onshore and offshore play types identified by both parties.
‚ÄúWe are very pleased to sign this deal with Black Spruce. This multi-well program accelerates the development of the region and provides the opportunity to unlock the full potential, which we have always believed is inherent, of our Newfoundland assets,‚ÄĚ Alan Minty of Enegi said in a prepared released.
David Murray, chief executive officer of Black Spruce Exploration Corp., said Black Spruce Exploration believes western Newfoundland is a highly prospective region and offers great potential.
‚ÄúWe are delighted to be partnering with Enegi whose expertise and knowledge of the region will be invaluable as we look to successfully develop these conventional assets.‚ÄĚ