MIRAGE ENERGY CORPORATION (MRGE) has announced it has entered into a binding memorandum of understanding (MoU) for the funding of its planned Concho/Progreso Pipeline and Natural Gas Storage facility connecting Texas to Mexico's national pipeline grid, SISTRANGAS (the ‘Project’). The binding MoU is with Organization Mondiale De development, a company registered in France (OMD). It is the Company's belief that the MoU will not become binding until OMD's ‘good will deposit’ of US$15 000 000 is paid to the Company.
The MoU sets out the terms of the proposed funding and participation in the Project. Under the MoU, Mirage proposes to sell 100% of its participation interest in the Project to OMD in exchange for its promise to fund the Project's estimated US$1 200 000 000 cost. OMD will offer Mirage a 5.0% carried equity participation interest which will be characterised as Mirage's put option interest in the Project. At the time, Mirage would exercise this put option, OMD would pay Mirage the sum of US$16 000 000. The proposed Project funding would include eight tranches of US$150 000 000 each payable at 30 day intervals commencing on, or about 15 April 2019. The closing of the proposed transaction is subject to the execution of definitive documents. In the event the transaction fails to close due to Mirage's fault, Mirage will be required to refund the good will deposit. In the event the transaction fails to close due to OMD, Mirage will be entitled keep a portion of the deposit, not to exceed US$10 000 000.
The project is designed to bring natural gas from the Banquete/Agua Dulce area to Station 19 and Los Ramones interconnection points on SISTRANGAS in Mexico coupled with access to the planned Brazil Field Natural Gas Storage Facility.
Mirage is planning a 42 in. diameter pipeline system that is being developed concurrently four sections: (i) a 46.2 mile bi-directional pipeline known as the Concho Extension connecting pipeline in Banquette/Agula Dulce area to Falfurrias, Texas, where an additional interconnection to Transco in being considered; (ii) a 93.9 mile bi-directional pipeline known as the Concho Line connecting the Concho Extension to a new international crossing at the Mexico border near Progreso, Texas known as the Progreso Crossing; (iii) a 36 mile bi-directional pipeline known as the Progreso Pipeline connecting the Progreso Crossing to CENAGAS STATION 19 in Mexico: and (iv) a 67 mile bi-directional pipeline known as the Progreso II Extension connecting the Progreso Pipeline at Station 19 to the Los Ramones interconnect in Mexico. A 14 mile bi-directional pipeline known as the Storage Line connecting the Progreso Crossing to the Brazil Storage Field in Tamaulipas, Mexico is also contemplated.
Mirage, through its wholly owned subsidiaries, anticipates commencing final development on the 1 April 2019 with a view toward receiving required US and Mexico permits and authorisations in 3Q19. The company has completed the necessary engineering and design of the pipeline and the natural gas storage field. The alignment for pipeline has also been substantially completed and are in the process of securing rights of way.
Read the article online at: https://www.worldpipelines.com/business-news/27032019/mou-for-funding-of-conchoprogreso-pipeline/
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