Hyperdynamics’ wholly owned subsidiary, SCS Corp, together with the Government of the Republic of Guinea have entered into a Second Amendment to the 2006 Production Sharing Contract (PSC).

The amendment was executed in accordance with the August 2016 Memorandum of Understanding signed between SCS and the Republic of Guinea.

Signed by the Director General of the National Petroleum Office, Diakara Koulibaly and Ray Leonard, Hyperdynamics' Chief Executive Officer, the amendment formally extends the PSC to September 22, 2017 and confirms SCS as the 100% interest holder and the Operator of the Guinea Concession.

The Second Amendment is to be in effect from the date it is approved by Decree of the President of the Republic of Guinea.

Under the terms of the amendment, Hyperdynamics will hold on to an area of about 5000 km² offshore Guinea and drill one exploratory well during the one year extension with an expected start-up date of April 2017 with possible additional wells.

The company will also provide a parent company assurance for well commitment, monthly progress reports and a reconciliation of budget to actual expenditures to the National Petroleum Office (NPO). If it fails to provide these reports and assurances on a timely basis it will be granted a notice of termination with a 30 day period to cure.

By January 31, 2017 Hyperdynamics will transfer the long lead items it obtained in its settlement with Tullow and Dana that are currently in Takoradi, Ghana, for the drilling of the exploration well into Guinean territory.

Failure to drill the exploratory well within the one (1) year extension period, Hyperdynamics will owe the Government of Guinea the difference between the actual expenditures in related to the well and $46,000,000.

“I am pleased with the Government of Guinea's continued support of Hyperdynamics and look forward to the opportunity to drill the Fatala well in the near future. Our efforts now shift to taking the operational steps in preparation for the drilling and in raising the required funds and/or teaming up with a partner in order to comply with the terms of the PSC Amendment,” Ray Leonard told Energy-pedia.

Anita Fatunji