Touchstone Exploration (Trinidad) Ltd. has entered into an agreement with BG Overseas Holdings Limited to acquire all the share capital of Shell Trinidad Central Block Limited.

Under the terms of the acquisition, Touchstone will pay BG Overseas Holdings Limited $23 million consideration in cash prior to closing adjustments. Completion of the acquisition is subject to customary regulatory and partner approvals, including the approval of the Ministry of Energy and Energy Industries. Touchstone is in active discussions with its Trinidad-based lender, Republic Bank Limited, to fund the Acquisition upon closing. The Acquisition will have an effective date of January 1, 2025, has a four-month long stop date, and is expected to close during the second quarter of 2025.

Shell Trinidad Central Block Limited (STCBL) holds a 65 percent operating working interest in the Central block exploration and production licence and gas processing plant in the Republic of Trinidad and Tobago with Heritage Petroleum Company Limited holding a 35 percent working interest. Current gross production from the Central block is approximately 18.0 MMcf/d of natural gas and 200 bbls/d of natural gas liquids (approximately 3,200 boe/d).

Paul Baay, President and Chief Executive Officer, said "We are pleased to enter into an agreement to purchase the Central block asset. The asset is a strategic fit with Touchstone's current land base and provides us access to world LNG prices for natural gas. The infrastructure associated with the assets provides processing and takeaway capacity for natural gas in the Herrera fairway. During 2025 we will consider pursuing an infill development drilling program at Central block and look to boost production and LNG sales."

The Central block assets include four wells in the Carapal Ridge, Baraka, and Baraka East liquids rich natural gas pools. In addition to existing low decline field production, the Central block asset base has facility optimization potential, infill drilling opportunities and exploration prospects.

STCBL holds three gas marketing contracts: one accessing the Trinidad domestic market, and two contracts accessing the Atlantic LNG facility in Trinidad. The Central block is situated in the Herrera fairway and is contiguous with Touchstone's Ortoire block, providing strategic potential for natural gas egress and marketing options from future discoveries. The Coho natural gas production is currently processed at Central block, and the Acquisition provides synergy potential for the field.

The Acquisition is subject to the fulfillment of certain conditions precedent and customary regulatory approvals, including the Company's ability to receive funding to complete the Acquisition. Hence, no assurances can be given that the Acquisition will ultimately be completed. Due to confidentiality terms in the agreement, Touchstone is not able to provide further information to the market on this Acquisition until the transaction is effectively closed, or terminated, as the case may be.

 According to Touchstone, the acquisition allows for 

  • Access to Atlantic LNG: STCBL is a party to natural gas sales contracts for the Central block asset, providing access to both local and LNG world gas market pricing.

  • Opportunity for Development: Touchstone has identified numerous infill well locations as well as a deeper Cretaceous prospect at Central block.

  • Strategic Infrastructure: The midstream assets of STCBL include an 80 MMcf/d gas processing plant (the "Evergreen Facility"), field natural gas and liquids flowlines, and a gas export pipeline to both the domestic market and the Atlantic LNG facility.

  • Increased Production: The Acquisition increases Touchstone's base net production by approximately 2,080 boe/d (94 percent natural gas) at current field estimated rates and provides incremental corporate cash flows.