StockMarketWire.com - Africa-focused oil company Tower Resources said it had agreed to sell down a 24.5% stake in its Thali prospect off the coast of Cameroon to OilLR.

The farm-out deal covered $7.5m towards the cost of the NJOM-3 well that Tower was planning to drill on the Thali block.

OilLR will receive the stake, subject to an overriding royalty of 10% for Tower on the contractor share of production.

The well cost was currently expected to be about $15m-to-$16m, of which around $3m had already been spent.

Tower said it was still in discussion with several other parties regarding the farm-out of up to a further 24.5% interest in Thali, on similar terms.

'We are delighted to have the opportunity to work with Greg Lee and Art Malone of OilLR on this project in addition to securing this funding for the well, and we intend to have the balance of the funding in place by the time this transaction completes,' chief executive Jeremy Asher said.

'This agreement is also consistent with our intention to commence drilling NJOM-3 in June, subject to finalisation of the rig schedule and the service companies' schedules.'

'We expect this well to transform the company by converting current contingent resources into proven reserves, so putting us firmly on the path to production in 2021.'




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