Under the terms of agreement, Shell E&P Colombia will acquire 85% participating interest in the VMM-28 block, which is currently owned and operated by PetroLatina’s Colombian subsidiary Petroleos del Norte S.A.
PetroLatina will receive a fee of $15m in cash, $3m on execution of the agreement and the remaining $12m on receipt of the requisite regulatory approval.
On completion of transaction, Shell E&P Colombia will become operator of the contract and will be granted exclusive operating rights to the contract for a period of six years.
Shell will pay for all the costs, expenses and liabilities associated with the work obligations for the VMM-28 block during the six years.
