PetroNor Acquires Additional Interests in Congo-Brazzaville Licenses
Oslo-based PetroNor E&P Ltd. has entered into an agreement to acquire an additional 6.33% interest in PNGF Sud license and an 8.86% interest in PNGF Bis license located off the coast of Congo-Brazzaville, for a combined consideration of US$22 million.
The transaction includes the acquisition of the remaining 29.293% in Hemla Africa Holding AS (HAH) from Symero Ltd., a wholly-owned subsidiary of privately-held NOR Energy AS, for a total consideration of US$18 million in stock, and the transfer of 9,900 shares of Hemla E&P Congo SA (HEPCO), representing a 9.9% stake in the company, from MGI International SA to HAH.
HAH previously held a 74.25% interest in HEPCO, which in turn holds 20% and 28% direct interests in the PNGF Sud and PNGF Bis licenses, respectively. As a result of PetroNor’s acquisition of the remaining 29.293% stake in HAH and HAH’s increased ownership of 84.15% interest in HEPCO due to the court ruling, PetroNor will now hold an increased 16.83% and 23.6% indirect interests in PNGF Sud and PNGF Bis licenses, respectively.
PNFG Sud covers an area of approximately 482 sq. km located in the Congo basin, situated 25 km off the coast of Pointe Noire. The license was awarded in January 2017 and lies in water depths ranging between 80 to 100 meters. Average daily production from the license amounts to around 1,465 barrels per day (bbls/d), net to the acquired interest. The work plans include infill drilling activities and other increased oil recovery initiatives expected to commence in Q2-2021. PNFG Bis is situated north-west of the PNGF Sud License, and includes the Louissima and Loussima SW discoveries.
“These are value accretive transactions that materially increase PetroNor’s production, reserves and cash flow. The opportunity to obtain a greater interest in PNGF Sud is wholly in-line with our stated growth strategy in terms of getting exposure to more economically robust cash flow and low-risk upside. PNGF Sud is already the stable foundation of our Company and its therefore an asset we know intimately well. The asset is operated by Perenco, a leading operator of mid- and late life assets in emerging markets with a proven track record of continuous increase in reserves and production and cost reductions to deliver higher margin barrels,” said Eyas Alhomouz, Chairman of Petronor.
Listed on the Oslo Axess Stock Exchange, PetroNor currently holds interests in E&P licenses in the Congo-Brazzaville, Senegal, Guinea-Bissau, Nigeria, and The Gambia.
The transaction is subject to customary closing conditions and regulatory approval, including receipt of approval by ordinary resolution at an extraordinary general meeting of PetroNor (expected to be held on March 5th), and is expected to close in April.