Ethiopia: Government approves farm-outs

The government has approved two farm-out agreements enabling Africa Oil Corporation to bring in Marathon Oil Corporation to the Rift Basin Area and increasing New Age (African Global Energy)’s holding in the Adigala Block. Under the terms of the Marathon farm-out agreement, Marathon will acquire a 50% interest in the Rift Basin Area. Africa Oil will maintain operatorship of the block, but Marathon has the right to take over if a commercial discovery is made. Marathon will pay Africa Oil $3m of past costs, and will fund $15m of its partner’s share of exploration.