Sweden's Lundin Petroleum AB (Lundin Petroleum) reported Friday that it has entered into an agreement to sell the FPSO Bertam to M3nergy Investment Ltd (M3nergy), a wholly owned subsidiary of M3nergy Berhad of Malaysia. Lundin Petroleum will receive a cash consideration of $265 million, based on a transaction effective date of Jan. 1.
Lundin Petroleum and M3nergy have entered an agreement under which Lundin Petroleum will sell to M3nergy the 100 percent issued share capital of Lundin Services Limited which owns the FPSO Bertam. The agreement remains subject to certain completion conditions, including finalization of M3nergy's external financing. The transaction is expected to complete during the first quarter of 2016.
Lundin Petroleum completed an extensive upgrade and life extension program on the FPSO Bertam in 2015 and the FPSO is now operating on the Bertam field in Block PM307, offshore peninsular Malaysia. The Bertam field commenced production in April 2015. Lundin Petroleum is the operator of the Bertam field with a 75 percent working interest, with Petronas Carigali holding the remaining 25 percent working interest.
M3nergy Berhad is a wholly owned subsidiary of the Sabah Development Bank Berhad in Malaysia, which is in turn wholly owned by the Ministry of Finance of the State of Sabah, part of Federation of Malaysia. M3nergy Berhad is an integrated service provider to the oil and gas industry in South East Asia.
Alex Schneiter, president and Chief Executive Officer of Lundin Petroleum, comments: "We are very pleased to be doing this deal with M3nergy, an experienced Malaysian FPSO owner. Owning infrastructure assets is not part of Lundin Petroleum's core strategy and this transaction will allow us to redeploy this capital into other areas of our business to fund our value driven growth."
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