Kinetiko Energy will force its partner to withdraw from a coalbed methane (CBM) project currently under development in South Africa.
Kinetiko served Badimo Gas, its partner in the Amersfoort CBM project, with a notice of withdrawal to exit the project after the South African company failed to meet cash calls totaling almost AU$ 1.4 million.
Australia listed and Souther Africa focused Kinetiko is the operator as well as a 49% participating interest holder in the Amersfoort project. Badimo holds a 51% share in the project.
“Under the terms of the Joint Operating Agreement (JOA), expenditure on the Amersfoort Project is obligated to be funded by both parties in accordance with their participating interest position. Badimo has failed to meet cash calls now totalling approx. A$1.4 million, has remained in default despite the issue of default notices by Kinetiko in terms of the JOA and has failed to rectify its payment default within a period of 60 days. Kinetiko has therefore exercised its option under the JOA to have Badimo withdraw from the Amersfoort Project and has issued a notice of withdrawal to Badimo as is provided for in the JOA,” Kinetiko said.
Subject to compliance with South African regulatory requirements and approvals for giving effect to such transfer, Kinetiko will hold a 100% participating interest in the Amersfoort Exploration Rights.
The Amersfoort Gas Project is located in the extensive Permian age coal fields of South Africa’s main Karoo Basin.
In a statement, Kinetiko said that its projects were “highly prospective for CBM and shallow gas and are ideally located. The current focus is on the Amersfoort Project (4 hours east of Johannesburg), it has Prospective Resource Estimates of 2.4 trillion ft3 Gas in Place (according to Gustavson Associates 2012). Kinetiko is developing clean energy solutions, in a high gas demand region and creating local jobs.”
Written by Sam Dodson
Read the article online at: https://www.worldcoal.com/cbm/12062014/kinetiko_forces_partner_to_withdraw_from_cbm_project_cbm49/