Philex, Forum Energy seal $10-M loan deal

Forum Energy PLC on Thursday said it has sealed a $10-million credit facility agreement with Philippines’ Philex Mining Corp. to fund the UK-based firm’s service contract (SC) 72 in West Palawan. The loan will enable Forum Energy — via subsidiary Forum Philippines Holdings Ltd. — to fund its 70-percent share in SC 72, the company said in a statement. Forum Energy said the credit facility will be available for three years at an interest rate of US Libor (London interbank offered rate) plus 4.5 percent. Forum Energy has approved a work program for SC 72, wherein its share is estimated at $7.4 million. “This work program is designed to provide a more comprehensive valuation of the property and identify potential sites for appraisal wells [in South China Sea]," said Andrew Mullins, executive director of Forum Energy. The work program includes 3D seismic work over 550 square kms around the Sampaguita Gas Discovery and 2,200 line kms of high resolution 2D over existing leads within the 8,800-square-km contract area. The seismic data would be completed within the first half of 2011 and will then be subjected to technical analysis, Mullins said. In 2006, seismic mapping done by Forum Energy confirmed minimum gas reserves of 3.4 trillion cubic feet and up to 20 trillion cubic feet n potential reserves. Via Forum Philippines, Forum Energy holds a 70-percent equity interest in SC 72. Philex controls 64.45 percent of Forum Philippines’ capital. — JES/VS, GMANews.TV