Canadian Overseas Petroleum says Shoreline venture extends agreement with Essar

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Canadian Overseas Petroleum Ltd (LON:COPL) (CVE:XOP) told investors that its 50%-owned joint venture company Shoreline CanOverseas Petroleum has extended the completion date of its agreement with Essar to April 30, 2021.

Following initial agreement in August 2020 the parties have been working to resolve their disputes.

“ShoreCan and Essar Mauritius, the shareholders of COPL’s Nigerian Affiliate, are engaged in the process to reach completion to the agreements announced on August 4th. As we indicated in October of last year, face to face or in person meetings are required,” said Arthur Millholland, COPL chairman in a statement.

READ: COPL secures finance for Atomic acquisition

He added: “Sub-Saharan Africa is currently in the midst of battling new virulent mutant strains of the virus, as are other jurisdictions, without the public health care systems that we rely on. When the restrictions are relaxed, we and our partners will act as soon practical to arrange and continue these discussions.

“Once the terms of the extension of the OPL 226 are in hand, the company’s Nigerian Affiliate will determine an operational schedule going forward and the timing for its execution.”

More recently, in December, COPL inked what was described as a “game-changing” acquisition, picking up Atomic Oil & Gas LLC.

The transaction has a reported deal value of US$54mln – comprising a US$1mln deposit, US$26mln of assumed debt, US$23mln of debt and cash payments, plus US$4mln in shares. It delivers producing assets in the US state of Wyoming, the Barron Flats Shannon Unit (57.7% owned by Atomic) and Cole Creek Unit (66.7% owned by Atomic).

Millholland said: “At present the company is focused on completing the Atomic acquisition, and then executing a plan to increase the oil production and value of the Atomic assets. All of this will be a great benefit to our shareholders in 2021.”

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