KEYFACT Energy
Frontera Energy has signed a farm-in agreement with Parex Resources, which is subject to Agencia Nacional de Hidrocarburos ('ANH') approval. Under the agreement, Frontera has received a 50% working interest in the VIM-1 Block in the Lower Magdalena Valley basin in Colombia in exchange for funding 100% of the first $10 million of the drilling, testing and completion costs of the La Belleza-1 exploration well, after which costs on the block will be split 50/50 with Parex.
The farm-in presents an exciting growth opportunity for Frontera and it is currently expected that the well will commence drilling during the second quarter of 2019. Capital expenditures associated with the farm-in agreement were included as part of the exploration capital budget for 2019.