The Norwegian oil and gas operator DNO ASA has been assigned the 20 per cent interest in Kurdistan’s Tawke oil field as payments of receivables owed to the company for past crude oil deliveries
Following the settlement, DNO holds a 75 per cent operated stake in the license containing Tawke and Peshkabir fields which are located in the northern Kurdistan’s Duhok region.
In addition to the 20 per cent interest, the company will also receive three per cent of gross licence revenues each monthe from the Kurdistan regional government over a five-year period. The settlement is effective as of 1 August 2017, said the company reporting to the press.
“We are very pleased with the government's initiative to settle receivables and normalise export payments to the operators,” said Bijan Mossavar-Rahmani, executive chairman of DNO. “This sends a strong positive signal to investors and helps restore confidence in Kurdistan's oil sector,” he added.
DNO said that the removal of these liabilities and the transfer to the company of the 20 per cent interest and the right to the three per cent revenue stream are expected to bolster its balance sheet and future cash flow.
The company has settled all its claims for all outstanding Tawke license receivables from the government. The government has exercised its Tawke license audit rights to its satisfaction for the period up to the effective date with no adjustment claims.
The government has also discharged DNO from certain payment obligations including production bonuses, license fees and a US$150mn water purification project that is no longer required by the government.
The Tawke and Peshkhabir oil fields’ combined proven and probable reserves are more than 500 mmbbl and its production in excess of 100,000 bpd.