i3 Energy plc (I3E),  announces it has entered into a drilling contract and a net revenue sharing agreement with Dolphin Drilling, to cover 22% of the cost of its drilling of its 2020 drilling campaign. 

 

Drilling Contract 

I3 has entered into a drilling contract with Dolphin Drilling Limited ("Dolphin") to utilise either the Borgland Dolphin or Blackford Dolphin semi-submersible drilling rig for a minimum 82-day programme, which is planned to commence not later than 1st September 2020. The contract is conditional on i3 confirming availability of funds to satisfy its obligations under the contract, 90 days prior to drilling commencement. 

 

Revenue Sharing Agreement 

In concert with the abovementioned drilling contract, i3 has agreed that Dolphin will earn up to a 10% economic interest (the "Dolphin Interest") in Block 13/23c via a Net Revenue Sharing Agreement (the "NRSA") in exchange for Dolphin forgoing its Profit Margin above its Opex, up to a maximum amount of US$14.4 million (the "Dolphin Commitment"). Accordingly, the Dolphin Commitment will cover approximately 22% of the total expected gross costs of each of the 2020 Campaign and Option Programme. 

 

Farm out 

As announced on 13th February and as evidenced by the above transaction, the Company is making good progress in its farm-out process to fund its 2020 drilling programme. The data room remains open and companies continue to actively evaluate the opportunity. i3 will provide further updates to the market as discussions progress. 

 

At this stage, i3 is not experiencing any direct impact to its business and does not yet foresee any disruption to its 2020 drilling programme from COVID-19. 

 

 

Majid Shafiq, CEO of i3 Energy commented: "We are delighted to have executed a drilling contract with Dolphin Drilling for our Summer 2020 appraisal programme. Dolphin performed exceptionally well in our 2019 campaign, drilling our wells on time and on budget and without any significant health, safety or environmental issues. Their support announced today not only contributes a significant component to the funding structure for our upcoming drilling campaign but also demonstrates the quality of our licenses."