Northcote provides the following announcement in respect to its Mexico Bid Process. As per the announcements dated 4 September 2015 and 9 October 2015, the Company had entered the data room and submitted its pre-qualification materials to the National Hydrocarbons commission (CNH) in respect to its intention to qualify and then participate in the bidding of Phase III of Round 1.
Northcote has elected to withdraw from the pre-qualification process in respect of this bid round; this decision was made after assessment of advice from Mexican counsel that by withdrawing the Company both preserves its participation rights with MX Oil and preserves its ability to participate in future bid rounds, enter into farm-out agreements with PEMEX or other industry partners.
Importantly Northcote maintains direct exposure to the Mexico bid process through its 20% participation right with MX Oil, alongside the 38 million warrants it holds in MX Oil. The Company is very confident in the strength of the MX Oil consortium and is pleased to note its announcement today. Additionally, Northcote’s technical understanding of the licences and regional potential gained through its due diligence in the data room places the Company in a strong position to potentially negotiate with other successful bidders, once the winning bids are known.
Northcote Managing Director Randall J. Connally said, “Our commitment to Mexico should not be underestimated, we maintain direct, de-risked exposure and access to the bid process through our agreement with MX Oil, which alongside warrants, confers us the right to participate at a level of up to 20% of their interest in any project they secure. In the meantime we are getting on with the work at Shoats Creek where the infrastructure work is underway, being a key step towards unlocking the enormous value in that field.”
