Atlantic Petroleum Norge AS has agreed to sell its Norwegian activities to M Vest Energy AS for the consideration of NOK 1 ($0.12).
The Norwegian activities include all of APN’s assets and licenses, the liabilities of the licences, the employees and a cash balance of approximately NOK 19 million ($2.2 million), which is “to be adjusted for costs and expenses from the date of the transaction, 1 January 2016, to closing”. Subject to completion, the transaction will result in the termination of all of APN’s petroleum activities. As a result of the transaction the company expects to record an impairment of approximately DKK 150 million ($22 million).
Atlantic Petroleum CEO Ben Arabo commented in a company statement:
“Following a formal sales process last year failing to solicit bids for the company or parts thereof, Atlantic Petroleum has over the past months been reviewing a range of strategic alternatives and the sale of its Norwegian activities is a step in the process of trying to resolve the issues facing the group in the current oil and gas industry market conditions. We believe the transaction is in the best interest of all stakeholders of the company and we are pleased that the activities in APN will be continued through M Vest Energy.”
The proposed transaction is conditional upon certain conditions including the approval from the Ministry of Petroleum and Energy and the Ministry of Finance.
As announced on February 5, Atlantic Petroleum North Sea Limited remains in default on the Ettrick, Blackbird and Chestnut fields. The Ettrick and Blackbird fields are subject to forfeiture by the operator of these fields, Nexen, and the company has lost the rights to petroleum from the Chestnut field while in default. Atlantic Petroleum North Sea Limited is currently in discussions with Nexen on the question of the forfeiture and continues to review its options during the time period available to remedy the default on Chestnut.
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