Sintana signs LOI for exclusivity period to PEL 37

Executive Summary

• Sintana Energy Inc. has entered into a Letter of Intent (LOI) to secure an indirect interest in PEL 37, a high-impact exploration block in the Walvis Basin, offshore Namibia.
• The agreement grants Sintana exclusivity through April 30, 2026, to conduct due diligence and negotiate terms for a capital contribution to Paragon Oil and Gas Pty. Ltd., the current operator of PEL 37.
• Sintana will pay a $1-million deposit to secure the exclusivity, with one-third of the deposit being non-refundable if Sintana chooses not to proceed.

Key Details

• Target Asset: PEL 37, located in the Walvis Basin, offshore Namibia.
• Location Context: Immediately north of PEL 82, which is operated by an affiliate of Chevron Corp. and where Custos Energy (an indirect affiliate of Sintana) holds a working interest.
• Asset Characteristics:
  • Area: 17,295 square kilometres.
  • Water Depth: Relatively shallow, ranging from 100 to 1,500 metres.
  • Prospects: Identified prospects at water depths between 300 and 600 metres.
  • Geology: Multiple large fans directly overlying a proven, mature oil-prone Aptian source rock.
• Current Operator: Paragon Oil and Gas Pty. Ltd. (100% owned and operated).
• Transaction Structure:
  • Sintana will contribute capital to Paragon to satisfy work obligations.
  • This contribution will result in Sintana becoming a shareholder of Paragon, thereby holding an indirect interest in PEL 37.
• Exclusivity Period: Initially through April 30, 2026.
• Financial Terms:
  • Deposit Amount: $1,000,000 USD.
  • Refundability: One-third ($333,333) is non-refundable if Sintana elects not to proceed for any reason.
• Strategic Rationale: The acquisition offers additional optionality associated with upcoming exploration activity in the adjacent PEL 82, where an initial exploration well is expected in the coming quarters.

Notable Quotes

• "The LOI we have entered into provides, at low cost, exclusivity over a material indirect interest in PEL 37, which is a high-impact block at the heart of the Walvis basin. In particular, PEL 37 is immediately adjacent to PEL 82, where we already have an interest and where an initial exploration well is expected over the coming quarters. Investing for a material stake in PEL 37 would thus afford additional optionality associated with upcoming activity in our existing portfolio." — Robert Bose, Chief Executive Officer