Asset A&D

Perenco Exercises ROFR to Acquire Sasol's Interest in Block DE-8, Offshore Gabon

By Isha Makkar
December 22, 2020
a minute read
Offshore Rig Sunset

Privately-held international oil & gas producer Perenco SA has exercised its right of first refusal to acquire the remaining 40% participating interest in Block DE-8, offshore Gabon, from a wholly-owned subsidiary of Sasol Ltd. Upon completion, Perenco will hold a 100% operated interest in the block.

In November, U.S.-based independent VAALCO Energy Inc. had entered into a Sale and Purchase Agreement (SPA) with Sasol to acquire an additional 30% interest in the Etame Marin block along with the 40% interest in Block DE-8, for a total cash consideration of US$44 million plus certain additional contingent payments of US$6 million.

The exercise of preferential rights by Perenco releases VAALCO from the potential obligation to drill an appraisal well in Block DE-8, and VAALCO will not be subject to the US$1 million contingent payment due upon success of the well. The financing terms of the original agreement did not attribute a material value to the undeveloped resource at Block DE-8. VAALCO disclosed that the previous purchase price for Sasol’s 30% participating interest in the Etame Marin block remains unchanged. However, the maximum future contingency payments have been reduced from US$6 million to US$5 million.

Block DE-8 covers an area of 590,800 gross acres in the North Gabon basin, and is located approximately 180 miles north-west of the Etame field. The block contains the Akoum-B discovery drilled in 2003, and a potential appraisal well on the Akoum-B discovery is to be drilled in 2021.

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