Pontus Marine LTD- Leader of fishing industry in Somaliland

Saturday, January 31, 2015

Somalia - Red Emperor NL ceases oil explorations in Puntland

(Medeshi)- Red Emperor Resources NL has issued the following statement in its quarterly report that the company is in the process of closing down its office in Bosaso and releasing its entire staff.
The statement of Red Emperor :

The Board of Red Emperor Resources NL (“Red Emperor” or the “Company”) is pleased to provide the following commentary and Appendix 5B for the period ending 31 December 2014.
Puntland : 
As reported in our last quarterly update, during the reporting period, the Federal Government hardened its position with regards to the requirement of contracts to flow through the Federal Ministry of Energy, as evidenced by the statement of the Federal Minister at the Somalia Oil & Gas Conference in late October 2014. As a result, and subsequent to the quarter end, the JV is currently in the process of closing down its office in Bosaso and releasing its entire staff. In addition, all contracts will be terminated, with exception of the production sharing agreements (“PSAs”), but including those for the lease of the villas and the lay-down yard, with all remaining inventory in Puntland being disposed of or sold.
The aim of these actions is to reduce the JV’s cost exposure until there is clarity and contractual certainty around the PSAs and the legal regime that currently exists in country.
The JV has proposed that the Puntland government offers it a two-year extension to both PSAs, free of any consideration, so that we may work together to properly establish the environment required for further investment in this exploration program.
Red Emperor is obviously disappointed that the above-mentioned actions have had to be taken, however we are very supportive of the operator, Horn Petroleum, and feel that the JV was left with no other alternative. The Company remains hopeful that an extension can be granted and the JV can once again operate in Puntland with the aim of unlocking the
enormous oil & gas potential that is believed to exist.
Source : Red Emperor Resources NL