Dana Petroleum Takes Stake in the Guinea Project
Hyperdynamics has finalized the sale of a minority interest in its oil and gas concession offshore the Republic of Guinea to Dana Petroleum.
Hyperdynamics and Dana signed an Assignment and a Joint Operating Agreement under which the U.K.-based company acquired a 23 percent participating interest in Hyperdynamics' Production Sharing Contract with the government of the Republic of Guinea (PSC). The assignment and JOA were made under the December 2009 purchase agreement between Hyperdynamics and Dana. According to its terms, Dana is to pay Hyperdynamics approximately $1.7 million for its pro-rata portion of accrued expenses associated with the Hyperdynamics' ongoing 2-D seismic program and bear a similar share of future costs for the program.
The closing follows the approval of the Assignment by Guinea's Ministry of Mines, Energy and Hydraulics.
Hyperdynamics and the Republic of Guinea are currently undergoing a review of the PSC in accordance with the September 2009 Memorandum of Understanding.
Upon the conclusion of the review and the effectiveness of any resulting clarifications and amendments to the PSC, Dana is to pay Hyperdynamics an additional purchase price of $19.6 million and assume its proportionate share of costs for all operations. Of that figure, Dana will pay $5.0 million in cash and the remaining $14.6 million will be paid either in cash or in shares of Dana Petroleum plc, at Dana's option. Should Dana choose to pay in stock, there would be no restriction on the immediate resale of these shares by Hyperdynamics.
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