Sintana subsidiaries agree to resolve arbitration

Executive Summary

• Sintana Energy Inc. (via subsidiaries Patriot Energy Oil and Gas Inc. and Patriot Energy Sucursal Colombia) has reached a resolution to dismiss ongoing arbitration against ExxonMobil Exploration Colombia Ltd. regarding the VMM-37 block in Colombia's Middle Magdalena Valley basin.
• As part of the settlement, Patriot will conditionally assign all rights and interests in the VMM-37 block to ExxonMobil.
• ExxonMobil has agreed to pay Patriot a total of $9 million in cash, split into two tranches, contingent on regulatory approval.

Key Details

• Transaction Structure: Dismissal of current arbitration and conditional assignment of all rights/interests in the VMM-37 block from Patriot to ExxonMobil.
• Financial Consideration: Total cash payment of $9 million to Patriot, structured as follows:
  • First payment: $3 million, due within 60 days of execution.
  • Second payment: $6 million, conditioned on approval of the assignment by appropriate Colombian governmental agencies (including the Agencia Nacional de Hidrocarburos) and other contractual requirements.
• Regulatory Conditions: The second payment and finalization of the assignment are contingent upon approval by the Agencia Nacional de Hidrocarburos and compliance with other contractual requirements.
• Mutual Releases: The agreement includes mutual releases between the parties.
• Strategic Context: CEO Robert Bose stated the outcome allows Sintana to streamline operations and focus resources on its active portfolio in the Atlantic margin (Namibia and Uruguay), while divesting legacy assets in Colombia.

Notable Quotes

• "We are pleased to bring this matter associated with our legacy position in Colombia to an initial conclusion. This outcome supports our efforts to streamline operations focusing resources on our active, high-impact portfolio across the Atlantic margin." — Robert Bose, Chief Executive Officer of Sintana