Bye Bye Selat-gone the way of the BudongHopefully this cuts the boat anchor that was tied to the company's neck...
The Company has an office in Jakarta, Indonesia where it conducts business for assessing and acquiring oil and gas projects in South East Asia. On October 14, 2019, the Company and its partner, PT Sumatra Global Energi (“SGE”) entered into agreements with the Government of Indonesia for the Selat Panjang PSC located in Sumatra, Indonesia. Sonoro has a 25% interest in the project with an option for up to an additional 24%. The partner holds the balance. At this time in 2019, SGE and Sonoro entered into financial agreements whereby SGE would advance Sonoro funds for its 25% interest which was used to fund Sonoro’s interest for the Signing Bonus and Performance Bond required for the PSC. The expectation was for Sonoro to pay back the financing in a short-time as the project progressed.
On October 21, 2021, SGE advised Sonoro, via Asiavest Trust, Sonoro’s Trustee representative company in Singapore, that Sonoro was in default of the Convertible Debenture and Loan for approximately $1.6 million and $300,000 respectively (the “Loan Agreements”) and that SGE requests release of Sonoro’s 25% interest in the PSC to SGE.
Since receiving this advice, Sonoro has adamantly objected to such relinquishment as SGE has had limited communication with Sonoro on the Salet Panjang project since mid-2020 including completion of the Joint Operating Agreement and most importantly advancing the Salet Panjang work program. Sonoro has attempted to communicate with SGE directly many times, has recently engaged lawyers in Singapore to assist and through SKKMIGAS, the oil and gas regulator in Indonesia. All methods for communicating and discussions have failed. SGE continues to not respond to Sonoro and has frustrated the project to a point that Sonoro believes that the project may not be be successfully completed under the current work program as required in the PSC. As a result, Sonoro as advised SGE that it will relinquish its interest in the project and that all Loan Agreements will be extinguished. Sonoro is interested in maintaining its interest should the project begin to advance and a SGE/Sonoro operating arrangement be agreed to.
Sonoro obstinately objects to the treatment it has received from its joint venture partner and believes it has exhausted all means to advance the project with the partner at this time and has been unfairly forced to relinquish its 25% interest in the project by the obstruction and maleficence by SGE.
Sonoro will continue communication with SKKMIGAS to object to the treatment it has received and will continue to seek compensation.
Sonoro will be seeking out other oil and gas opportunities in Asia and will update shareholders as soon as possible for any developments.