Malaysia's Sona Petroleum to Acquire Australia's Stag Oilfied for $50M
Sona E&P Perth (Pty) Ltd. (Sona Australia) signed a sale and purchase agreement (SPA) with Quadrant Northwest Pty Ltd. (Quadrant) and Santos Offshore Pty Ltd. (Santos) to acquire 100 percent interest in Stag Oilfield in Production License WA-15-L offshore Western Australia for $50 million (MYR 215.2 million), its Malaysian parent firm Sona Petroleum Berhad reported Monday in a filing with local exchange Bursa Malaysia.
Under the proposed acquisition, Sona Australia will owns a full stake in Production Licence WA-15-L, Pipeline Licence WA-6-PL and associated assets. Upon completion, Sona Australia will take over operatorship of the oilfield, which is located in the Dampier sub-basin of the Carnarvon Basin in water depths of approximately 164 feet (50 meters) and approximately 37 miles (60 kilometers) offshore.
Completion of the SPA, subject to approvals from regulatory authorities in Australia and Malaysia as well as company shareholders, is expected by the first half of 2016.
"The Purchase Consideration will be satisfied entirely in cash and will be funded via Sona Petroleum's internal funds raised from its initial public offering (IPO) held under a trust account (net of taxes payable) amounting to approximately $122.1 million (MYR 525.6 million) as at Oct. 30," the firm said.
Upon completion of the SPA, Sona plans to further develop the Stag Oilfield, which has been in production since 1988, to increase its output. This is to be achieved through, among others, the drilling of infill production wells, comprising the addition of new wells to the existing fields within the original well patterns to accelerate recovery of oil.
At the moment, oil from the field is produced from horizontal wells and processed through a fixed central production facility platform with 50,000 barrels per day capacity. Oil is then transported by pipeline to the floating storage offloading (FSO) facility and loaded to shuttle tankers for North Asian customers.
"The Stag Oilfield has potential development and exploration opportunities and therefore, in a single transaction, Sona Petroleum will be able to enter the production, development and exploration stages of the upstream value chain," the company commented.
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