StockMarketWire.com - Africa-focused oil company Tower Resources said it had in recent weeks engaged in talks regrading an up to $10m loan to fund development of the Thali prospect offshore Cameroon.

The proposed facility would provide the funding for the NJOM-3 well currently in progress.

It may also be expanded to support the next three production wells and platform planned for the Njonji development at Thali, subject to the results of the NJOM-3 well.

The loan would be secured by proceeds from a current production sharing contract.

Tower Resources had an agreement with OilLR for the latter to farm in to the production sharing contract to provide up to $7.5m for the NJOM-3 well.

However, OilLR had not yet made a payment into escrow contemplated by that agreement, meaning Tower had an option either to reduce OilLR's investment to $5m or to terminate the agreement.

Tower said it also remained in discussions with another potential farm-in partner.

'The company is considering its options with regard to the OilLR agreement in light of other discussions, notably regarding the proposed $10m loan facility, and the terms of the agreement do not set any deadline for the company to declare its options, apart from a planned completion date of 15 September,' it said.

Tower also said it also was currently in discussions regarding an extension of its current loan facility, held by Pegasus Petroleum.


At 9:29am: [LON:TRP] Tower Resources PLC share price was -0.01p at 0.39p



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