Trinity expands drilling interest in Galeota
Trinity Exploration now has a 100 per cent working interest in the Trinites field off the southeast coast of Trinidad, part of the Galeota Licence.
In a release on Monday, the country’s largest local independent exploration and production company said State oil company Petrotrin had, as of October 2013, converted its 35 per cent stake in the oilfield to an over-riding royalty (ORR).
This means the company will not participate in drilling or production activities, but instead receive a percentage payment of the value of production output. Petrotrin will, however, maintain its 35 per cent stake in the rest of the Galeota Licence, as per a Production Sharing Contract.
The Galeota Licence is a key asset for Trinity; early last month the company’s third exploratory well struck oil in the TGAL-1 block, with a production potential of up to 150 million barrels of oil.
“The recent announcement of the TGAL–1 exploration discovery provides additional confidence in the underlying resource potential of the Block,” Trinity said.
Trinity also recently signed a new crude oil sales agreement (COSA) with Petrotrin for the sale of its share of production from the Trinites field.
This agreement harmonises pricing of the Trinites crude with Trinity’s other sales agreements under which oil pricing is linked to West Texas International pricing. The new arrangement is effective August 1, 2013 and has a two-year term with a further option for renewal, the company said.
All other key terms remain unchanged.
“Trinity strongly believes in the potential of the Galeota Licence which has all the necessary components to build a significant production hub, that is infrastructure, existing production and a significant development, appraisal and exploration inventory.
“These new arrangements increase Trinity’s financial and operating flexibility thus enabling further investment in this Block to grow reserves and production for our shareholders. Trinity’s joint venture partner, Petrotrin, continues to work positively with the company to achieve a common objective of increasing oil production.
“Twenty fourteen is set to be an exciting year at Galeota. We are pleased to be re–commencing drilling operations at the Trinites field as delivering production growth is a core focus of Trinity.
“As previously announced we have also commenced engineering studies to rapidly move our TGAL–1 discovery to a development project and will provide an update to shareholders when this work is complete,” Trinity’s chief executive officer Monty Pemberton said.