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Monday, October 31, 2011
Kulczyk Oil Ventures (KOV) reported the Neconde consortium, of which it is a part, has signed an agreement extending the time frame for the proposed closing of the acquisition of oil and gas assets in Nigeria until November 14. The oil and gas asset is OML 42 and in May KOV joined the Neconde consortium, the winner of the bid for the stake in OML 42, as a 20% shareholder.
The Neconde consortium entered into various agreements with SPDC, Total E&P Nigeria Ltd., and Agip Oil Co. Ltd. to acquire a 45% participating interest in OML 42. The acreage is a large license containing previously discovered oil fields in the onshore Niger Delta. The remaining 55% participating interest in OML 42 is currently held by state-run NNPC.
In order to facilitate its participation in the Neconde consortium, Kulczyk Investments SA (KI), the major shareholder of KOV, provided bridge financing in respect of the company's share of acquisition costs. KI and the KOV agreed that until such time as the company raises funds to repay KI, the shares of Neconde allocated to KOV would be held in trust by KI. They further agreed, in anticipation that the acquisition would have closed prior to the end of October 2011, that if the company had not raised funds to repay KI for its bridge financing prior to October 31 the trust arrangement between KI and the company would be terminated and KI would become fully entitled (legally and beneficially) to KOV shares in Neconde. An agreement in principle has been reached between the company and KI to provide for an extension of that bridge financing to accommodate the extension agreed to between Neconde and the sellers in relation to closing the transaction.
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