Frontier's 100%-owned Block 38 is located in the Rub Al Khali Basin in the southwest of the Sultanate of Oman and covers a surface area of approximately 17,425 square kilometers. A six year Exploration and Production Sharing Agreement (EPSA), comprising two three-year phases, was signed on 25 November 2012. Frontier is the operator. In April 2015, the Company announced that it had received approval to exchange the Phase 1 work commitment of a 3D seismic survey for an exploration well with a 2D seismic survey and that it would start discussions with the tender board to begin the process to select suitable contractors to complete this work program.

Subsequent to this recent agreed change in the work program, Frontier has entered into preliminary discussions with Middle East-based entities regarding a potential farm-in to Block 38. The Company anticipates that any formal farm-in agreement would include a carried interest for Frontier through the initial drilling program and the repayment to Frontier of a proportion of its sunk costs to date (which currently amount in total to US$1.6 million). Completion of any farm-out would be subject to formal documentation and due diligence and in respect of a transfer by Frontier of the operatorship of Block 38, would also be conditional on Oman regulatory approval.

Tags: Frontier Resources International