Azonto Petroleum has completed a sale of its shares in Vioco Petroleum to Vitol for $4 million, the company said on Friday.
This means Azonto has now exited the Gazelle development, offshore Ivory Coast, as Vitol now owns a 100 percent share in Vioco, which is the operator of the block.
Prior to the sale Azonto held 35% of the shares in Vioco, which operates and holds an 87% working interest in the CI-202 Block in Côte d’Ivoire, where the Gazelle project is located. Vitol E&P owned the remaining 65% of the shares in Vioco.
Azonto further said that the sale of associated wellhead drilling equipment for an additional amount of US$1,100,000 (less the value ascribed to any wellhead drilling equipment which is removed or damaged prior to completion) has not yet completed and remains subject to satisfaction of certain conditions precedent prior to 7 November 2015.
As per the sale agreement, Azonto may receive further $2,000,000 upon the occurrence of a commercially viable hydrocarbon discovery in the licence.
Announcing its plans to sell, in July 2015, Azonto explained that it had become increasingly clear to the Board that the combination of challenging conditions in the oil and gas sector currently, including low and volatile oil prices and weak equity market sentiment on the sector, have significantly increased the risk that the company would not be able to secure further funds or agree one or more alternative transactions, before its existing cash resources run out.
Azonto noted that the sale will provide financial stability to the company, as in recent months, the Gazelle project has experienced cost growth, leading to delays, all against the backdrop of a wider sector environment which has become increasingly challenging.
Following completion of the sale of shares in Vioco, the Company’s cash and cash equivalents is approximately US$4,800,000.
Azonto on Friday also said that Gregory Stoupnitzky, currently Managing Director of Azonto, will cease his executive role and employment by the Company with effect from 17 September 2015. In addition, the Company announces the following departures from its senior management: Jeff Durkin, General Counsel, will be leaving the Company effective 17 September 2015. Gert-Jan Smulders, Technical Director, left the Company on 10 August 2015.