Prominence Energy (ASX:PRM) receives 12-month lease extension at Bowsprit

• Prominence Energy (PRM) has received a 12-month lease extension at two leases, SL21787 and SL21787, within its Bowsprit Project in New Orleans
• The leases now expire on March 14, 2022, to facilitate the intended drilling of Bowsprit
• With this extension, Pinnacle and Prominence have agreed to extend the completion date of the buy-out agreement, with the completion expected prior to drilling
• On market close, Prominence is in the grey and trading at 1.2 cents per share

Prominence Energy (PRM) has received a 12 month lease extension at two leases, SL21787 and SL21787, within its Bowsprit Project.

The approval of the extension has come from the Department of Mineral Resources of the State of Louisiana.

The oil and gas leases now expire on March 14, 2022, to facilitate the intended drilling of Bowsprit.

In 2017, Prominence Energy purchased Bowspirit with Pinnacle Explorations. Both companies own 50 per cent of the project, but in 2019, Prominence agreed to purchase Pinnacle’s interest.

With this extension, Pinnacle and Prominence have agreed to extend the buy-out agreement, with completion expected prior to drilling.

The Bowsprit leases are located around 70 kilometres southeast of New Orleans in about three metres of water.

Drilling plans at the project include a vertical pilot hole to evaluate the prospective underlying Middle Miocene exploration targets.

The company was at a final documentation stage in March 2020 to fund the well, just before the downturn of COVID-19.

Managing Director Alex Parks said, excluding another downturn, there is a good chance the project can be farmed out and drilled this year.

“Since the beginning of 2021 the oil price has increased to approximately US$65 a barrel [around A$84] and there has been a surge of interest in oil projects in the
U.S,” he said.

“Bowsprit is in state waters and should not be affected by any federal land oil and gas policy changes made by the Biden presidency,” he added.

On market close, Prominence is in the grey and trading at 1.2 cents per share.