Twoco Petroleums Ltd. (TSXV:TWO) announced that it plans to sell 70 percent of its working interests in its Alberta-based Sparky heavy oil property to an oil and gas investment fund located in Seoul, Korea for C$28 million as per an arm’s length definitive agreement.
As quoted in the press release:
The sale is effective June 1, 2012 (the “Effective Date”) and is expected to close on or about October 17, 2012, subject to, among other things, the finalization of the formation of the Fund by no later than October 12, 2012 and receipt of all necessary regulatory approvals.
Pursuant to the Sale Agreement, Twoco and the Fund (or a Canadian entity to be established by the Fund, such entity and the Fund, collectively, the “Purchaser”) will, at the closing of the sale, also enter into a net revenue guarantee and transfer agreement (the “Net Revenue Agreement”) providing for, among other things, a development drilling program in respect of Twoco’s Sparky heavy oil property and a net revenue guarantee in favour of the Purchaser. Pursuant to the Net Revenue Agreement, the Purchaser will agree to fund its 70% share of a ten (10) well development drilling program to be completed within one year of closing of the sale. The Purchaser’s share of the development drilling program is expected to be approximately Cdn.$10 million.