Sintana Energy has paid Paragon Oil and Gas a deposit of N$16.44 million (US$1 million) to secure exclusive rights to assess an investment that would give it an indirect interest in Petroleum Exploration Licence (PEL) 37 in the Walvis Basin offshore Namibia.
The exclusivity arrangement is set out in a letter of intent between the two companies and runs until 30 April 2026. During this period, Sintana will carry out technical, commercial and legal due diligence and negotiate terms for a potential capital contribution.
If completed, the transaction would see Sintana acquire a shareholding in Paragon, resulting in an indirect interest in PEL 37. One-third of the N$16.44 million deposit is non-refundable should Sintana elect not to proceed.
“The letter of intent provides, at relatively low cost, exclusivity over a material indirect interest in PEL 37, a high-impact block at the heart of the Walvis Basin,” said Sintana chief executive officer Robert Bose.
“PEL 37 is immediately adjacent to PEL 82, where we already hold an interest and where an initial exploration well is expected in the coming quarters,” he added.
PEL 37 covers approximately 17,295 square kilometres in water depths of between 100 metres and 1,500 metres. The licence hosts several identified prospects at depths of 300 metres to 600 metres and is underpinned by a proven, oil-prone Aptian source rock with multiple large fan structures.
The block lies immediately north of PEL 82, where an affiliate of Chevron Corporation is the operator. Custos Energy, an indirect affiliate of Sintana, holds a working interest in PEL 82, where Chevron has indicated plans to accelerate exploration, including drilling an exploration well in the coming quarters.
“Securing a material stake in PEL 37 would provide additional optionality linked to upcoming activity across our existing portfolio,” Bose said.
“Over the coming months, and with the benefit of the exclusivity secured, we will undertake the work required to determine whether to pursue this strategic expansion of our core portfolio. Further announcements will be made in due course.”
