Petroceltic Completes Sale of Stake in Algerian PSC

Independent oil and gas firm Petroceltic International announced Tuesday that it has completed its sale of an 18.375-percent interest in the Isarene production sharing contract to Algerian state oil company Sonatrach.

Petroceltic reported that the deal was effected via a sale-and-purchase agreement under which Sonatrach has acquired a further 18.375-percent interest in the Isarene PSC covering Blocks 228 and 229a. The terms of the deal provide for a consideration of up to a maximum amount of $180 million, which comprises a $20 million payment now and a further $140 million payment of Petroceltic's share of the Ain Tsila project's development cost, as well as contingent payments of up to $20 million based on the achievement of certain project-related milestones.

Following completion of the deal, Petroceltic has a 38.25-percent interest in the PSC and remains as operator of the license, while Sonatrach has a 43.375-percent interest. Enel maintains its 18.375-percent interest.

Petroceltic Chief Executive Brian O'Cathain commented in a company statement:

"We are delighted to announce the completion of the Sonatrach farm-out. Petroceltic has had a positive and mutually beneficial relationship with Sonatrach throughout the exploration, appraisal and now development phases of the Isarene PSC. The formal ratification of this agreement is a critical step in the overall funding plan for this development project. As development operations ramp-up, we look forward to continuing to work with Sonatrach and Enel to deliver the Ain Tsila Project and to maximise the value of this important national resource for Algeria."

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