Pursuant to the agreement, Rey will earn up to 43.47% in the permit by contributing to 86.94% of the costs. This cost is to be capped at $1.7 million for the Dunnart-2 exploration well, which will be managed by Key Petroleum as the operator of the permit. Costs over $1.7 million will be apportioned between the parties in accordance with their respective interests in the permit.
Post-transaction ownership: Key Petroleum (43.47%, operator), Rey Resources (43.47%) and Caracal Exploration (13.06%).
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.