Melbana Energy Limited announced on 26 April 2019 that it has cancelled the farm out agreement signed on 31 December 2018 with Anhui Modestinner Energy Co. (AMEC), for Block 9, located onshore North Cuban Province. AMEC, a subsidiary of Anhui Guangda Mining Investment Co Ltd (AGMI), did not satisfied the conditions listed in the agreement according to the timetable â which included Cuban and Chinese approvals. Melbana will pursue discussions with other interested companies, according to their statement â but it is also open to re-evaluate the partnership with AMEC.  The agreement signed, AMEC would fund all operational costs for at least three exploration wells, with two drilled prior to 1 November 2019 â prospects Alameda and Zapato. If a discovery is confirmed, an appraisal well will be drilled, if not â a third exploration well, Piedra prospect will be drilled prior to July 2020. AGMI also assumes operatorship. In the event of a commercial success Melbana would recover its back costs from the authorized cost recovery pool as well as 12.5% of the profit oil. The company has been searching for a partner since November 2017 following the Cuban governmentâs refusal to grant Petro Australis the right to exercise a 40% back-in option on the block, as a result Melbana retains a 100% interest.    Melbanaâs top three prospects on Block 9 are: Alameda, Piedra and Zapato. Third party consultants in a recent prospective resource assessment of the block, assigned a best estimate prospective resources of 270 MMbbl of oil in the five targeted objectives contained within the three prospects.    Alameda      Prospect will test three separate objectives in the Upper and Lower Sheet      formations. Best Recoverable Prospective Resources of the three objectives      at 140 MMbbl of recoverable oil and assign 72 MMbbl of recoverable oil and      a 32% chance of success.  Piedra      Prospect will test a Lower Sheet fractured carbonate closure which      features roughly 1,400m (4,595 ft) of vertical relief at its crest. Best      Recoverable Prospective Resources at 34 MMbbl of recoverable oil and a 23%      chance of success.  Zapato      Prospect will test a Lower Sheet fractured carbonate closure which      features almost 1,000m (3,280 ft) of vertical relief. Best Recoverable      Prospective Resources at 95 MMbbl of recoverable oil and a 23% chance of      success.   On 11 October 2017 Melbana Energy Limited announced the company had notified Cuba Petroleo Union (CUPET) authorities it has fulfilled all its commitments required for the 1st sub-period of exploration on the Block 9 Production Sharing Contract (PSC). The commitments included reprocessing of 200 km of 2D seismic data and several geological studies. The 2nd sub-period of exploration starts on 3 November 2017 and has a term of 2 years and requires the drilling of one well on the block.    The      company completed a prospectivity assessment of the 2,380 sq km block in      February 2017 and estimates the block to contain 12.5 Bbbl of in-place oil      resources, with prospective recoverable resources pegged at 637 MMbbl.      Melbana also reported that it has identified 19 prospects and leads within      the tract.   Â Drilling in 2018 is expected to target the Alameda prospect, which will test three independent objectives with a deviated well, and possibly the Zapato or Piedra prospects. Costs for the two-well campaign are estimated at USD 20 â 30 million. The Cuban government is targeting accelerated oil exploration to increase its production volumes, currently reported to be approximately 45,000 b/d of oil plus 3 MMcm/d (100 MMcf/d) of gas.
Melbana Energy said it has terminated a farm-out agreement for Block 9 due to a lack of progress by the farminee Anhui Modestinner Energy.