“The structure of these agreements minimises the company's exposure to fixed operational costs and allow for the continued management of G&A exposure,” said Alastair Ferguson, Solo chief executive.
“We look forward to working closely with these top-quartile service partners as we further progress towards the completion of our strategic production goals."
With THREE60, Solo has entered into a ‘service collaboration and risk sharing model agreement’ which will see the new partner provide assistance with subsurface, engineering and facilities operations.
The agreement is described as being flexible and cost-effective. Solo highlighted that the agreement defines a risk sharing model which is expected to minimise capital expenditure, via incentivisation linked to asset and production performance.
A framework agreement with NRG, meanwhile, envisages a ‘complete managerial and technical support package’ spanning the exploration, appraisal and development life cycle.
Solo told investors that no costs are tied to putting either agreement in place, and that costs are only incurred as and when activities are performed by the new service providers.