Lukoil Pays $800MM to Enter Rep. of Congo Project
Lukoil has concluded an agreement with New Age M12 Holdings Limited to acquire a 25 percent interest in the Marine XII license, in the Republic of Congo, for $800 million in cash.
The transaction is subject to customary conditions, including the approval by the government of the Republic of Congo.
The license covers five discovered fields thought to contain 1.3 billion barrels of oil equivalent of proved and probable (2P) reserves. Two of these fields, Nene and Litchendjili, currently produce 28,000 barrels of oil and gas condensate per day and 1.7 million cubic meters per day of marketable gas, Lukoil highlighted.
"Entering this project is in line with our M&A strategy. The project is characterized by explored reserves, substantial production growth potential, access to well-developed infrastructure and it also fits our technological expertise,” Vagit Alekperov, president of Lukoil, said in a company statement.
“On top of that, the project is already free cash flow positive. We are also pleased to expand our partnership with Eni that is well-experienced in international offshore projects and known for its successful footprint in the region", Alekperov added.
The Marine XII license is based on a production sharing contract. Eni is the project's operator with a 65 percent stake. State company Société Nationale des Pétroles du Congo holds a 10 percent interest.
Lukoil describes itself as one of the largest publicly traded, vertically integrated oil and gas companies in the world. The company accounts for more than two percent of the world's oil production and around one percent of proved hydrocarbon reserves, according to its website.
Last month, Lukoil revealed that Alekperov had met with Denic Sassou Nguesso, the president of the Republic of the Congo, and discussed prospects for bilateral cooperation.
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