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- Sacgasco (SGC) subsidiary Nido Petroleum Philippines signs an agreement to buy key drilling long lead items (LLI) for planned work at two prospects
- All up, Nido will pay US$2.9 million (A$4.04 million) for the equipment, with US$1.4 million to be paid within the first four months of the deal
- The remaining US$1.5 million will be paid either 12 months after the agreement date or on a date immediately before the equipment arrives on site — whichever comes first
- Once received, the equipment will be used to drill at the Nandino Prospect and the Cadlao Oilfield
- Sacgasco is up 4.76 per cent with shares trading at 2.2 cents at 1:51 pm AEST
Sacgasco (SGC) subsidiary Nido Petroleum Philippines has signed an agreement to acquire key drilling long lead items (LLI) for planned work at two prospects.
The purchased equipment includes conductors, casings, liner hangers, casing accessories and wellheads.
All up, Nido will pay US$2.9 million (A$4.04 million) for the equipment, with US$1.4 million to be paid within the first four months of the deal.
The initial consideration consists of US$400,000 to be paid in seven days upon execution of the formal purchase agreement, US$500,000 to be paid within 90 days of the agreement date, and US$500,000 to be paid within 120 days of the agreement date.
The remaining US$1.5 million will be paid either 12 months after the agreement date or on a date immediately before the equipment arrives on site — whichever comes first.
This structure allows Sacgasco to use a combination of money from its recent capital raising and projected cashflow from its North American operations to fund the buy.
Once received, the equipment will be used to drill at the Nandino Prospect and the Cadlao Oilfield.
“I am very pleased that we have been able to purchase long-lead item equipment for the planned two well drilling program. Acquiring this equipment in a tightening supply market is very astute, fixing future cost and timing,” SGC Managing Director Gary Jeffery said.
“We continue full speed ahead on the execution of the planned 2022 two well drilling program and extended well test(s) in the Philippines.”
Sacgasco was up 4.76 per cent with shares trading at 2.2 cents at 1:51 pm AEST.
