Predator Oil and Gas completes acquisition of Challenger Trinidad

Predator Oil & Gas (Predator) has completed the acquisition of Challenger Energy (CEG) Group's operations in Trinidad and Tobago.

CEG’s operations in Trinidad include three onshore producing fields: Goudron, Inniss-Trinity, and Icacos. Across these fields, there are a total of 250 wells, of which approximately 60 are in production at any given time. Within the fields, regular well workover operations are undertaken on the existing production well stock, including well stimulation operations, reperforations, reactivations, and repairs to shut-in wells, as and when appropriate.

The acquisition includes a revenue-sharing agreement with NABI Construction, allowing Predator to benefit from increased production without bearing field operating costs. Predator has executed a Production and Field Services Management Agreement with NABI Construction Limited (NABI) to replicate the arrangements for the Bonasse Field to cover the Goudron, Inniss-Trinity, and Icacos Fields.

In accordance with the agreement, Predator will receive 30% of gross sales receipts at the sales point after deduction of royalties and taxes from the existing production, with no exposure to field operating costs and investment costs required to satisfy the minimum work obligations for the licenses.

NABI will initially execute up to 13 heavy well workovers (HWO) over the next 12 to 24 months with the objective of enhancing the current consolidated field production of 285 bopd by up to 40%. NABI will also execute a drilling program to satisfy the minimum license obligations over the next two years.

For the incremental production and the new drilling, on any new well, or heavy worked over well, Predator will receive 15% of gross sales receipts of those respective wells at the sales point after deduction of royalties and taxes until recovery by NABI of HWO and drilling costs on a well-by-well basis.

In addition, Predator's wholly owned subsidiary, T-Rex Resources (Trinidad) Ltd. (T-Rex), has entered into final negotiations with the rig contractor for the T38 Rig reactivation and commissioning to drill Snowcap 3 in early 2026, and any other prospects identified by T-Rex after the completion of the Snowcap-3 appraisal and development well. T-Rex and the rig contractor expect to execute the final contract upon submission of regulatory documentation to the Ministry of Energy next month.

Predator will complete a technical review of the portfolio of assets in SVG to identify new prospects for drilling and missed opportunities for well interventions.

According to the company, the acquisition of Challenger Trinidad's existing business structures, contractual arrangements, facilities, and practical operations experience creates material substance and the in-country relationships necessary to support Predator’s logistical infrastructure required to strengthen its primary business objective: to operate its core asset in the Cory Moruga Exploration and Production Licence through appraisal and development and the transport and sale of oil into a pipeline entry point.

Predator states further that with 2P/2C unrisked Contingent and Prospective oil resources of 14.31 million barrels of oil, unchanged since the January 2024 Independent Technical Report, and a projected peak field production rate of 3,000 to 4,000 bopd based on the adjacent Moruga West Field production profile analogue, developing the Cory Moruga asset continues to represent a high reward opportunity now supported by the enlarged portfolio of Trinidad assets and infrastructure.

Paul Griffiths, Chief Executive Officer of Predator, said, "We are pleased to have successfully completed the acquisition of three new producing assets with an immediate generation of revenues for the company from the completion date. The agreement executed with NABI relieves the company of the burden of funding minimum work obligations and field operating costs. The arrangement also ensures that an aggressive heavy workover and infield drilling program will be executed over the next 24 months to address overlooked opportunities with potential to enhance oil production. It provides multiple newsflow opportunities. The revenue-sharing agreement with NABI may be regarded as a form of royalty that guarantees positive cash flow for the company without exposure to operational risks.

According to the company, the consolidation of the Trinidad business structures within the overall company management structure minimizes administrative costs, and by not entering into interest-bearing loan arrangements, exposure to potentially higher reward drilling opportunities is maintained.

The timing of the completion of the acquisition is particularly noteworthy given the recent reports from Trinidad of ExxonMobil entering the Trinidad offshore with a committed expenditure of $42.5 million and a reported speculative $16.4 to $21.7 billion spend on development if initial seismic and other technical studies are successful. This will ensure that Trinidad will be a center of attention in the oil and gas sector over the next few years.

We have focused on getting the Trinidad acquisition over the line while we have a short operational hiatus in Morocco. In September, we will review the data for the perforated MOU-3 'A' Sand interval and prepare to plan for the next phase of operations."

On completion of the transaction, Eytan Uliel, CEO of Challenger Energy, said, "I am pleased to report that we have completed the sale of our business in Trinidad and Tobago. This allows full focus on our core assets in Uruguay, where we have a compelling opportunity to create near-term value for our shareholders".