The company farmed out its remaining 15 per cent stake in the Odewayne block production sharing contract, onshore Somaliland, East Africa, to Sterling Energy for US$12 million.
The farmout came after Jacka farmed out its first 15% stake in the block in January, with Jacka cancelling the US$12 million future conditional payments due under the original Sterling transaction.
The transaction will leave Jacka with no part in the production sharing contract, though it retains an option to acquire a 5% participating interest, coming from its original farm-in agreement with Petrosoma, which holds 10% of the project.
Operator Genel Energy holds a 50% stake, while Sterling’s stake has increased to 40%.
The option can either when the parties entering into the Fifth Period of the PSC or a second well is proposed.
The PSC is currently in the third period (expiring November 2014) with an outstanding minimum work obligation of 500 kilometres of 2D seismic.
The minimum work obligation during the fourth period of the PSC, which expires in May 2016, is for 1,000 kilometres of 2D seismic and one exploration well.
Jacka managing director Bob Cassie said the company’s Somaliland operations had been delayed by security concerns, with operator Genel Energy working to resume operations as soon as possible.
“Jacka remains enthusiastic about Somaliland and considers the option to acquire another 5% interest in the future as providing the Company and its shareholders with an opportunity to re-enter the project as work advances,” he said.
“Jacka will emerge with a strong balance sheet and can now look forward to progressing the Aje Field (OML113 offshore Nigeria) through a final investment decision (expected in mid-2014) and into development,” he added.
Jacka has a 5% revenue interest in the permit.
The news came after Jacka completed a fully underwritten entitlement offer which raised $2,8 million, in addition to a placement which raised $1 million, a reduction of 20% in operating costs following a review, and the appointment of new chairman Max Cozijn and James Robinson to the board.
“The Company has taken a number of very important steps as it continues to reinvigorate and maximise the value of its asset portfolio,” Mr Cassie said.
“With a quality asset base and a determined Board of Directors and Management, the Company is now well placed to deliver shareholder value.”