Bengaluru — Energean on Thursday said it would acquire Chevron’s (CVX.N), opens new tab interests in two offshore Angola oil blocks for a base consideration of $260 million, as the Mediterranean-focused gas producer follows through on its plan to build out a hub in West Africa.
Energean has been increasing investment to lift production amid geopolitical disruptions and is evaluating new M&A opportunities in the region as it seeks to expand its portfolio.
Some key details about the deal:
– Energean to buy Chevron’s 31% operated interest in Block 14 and 15.5% non-operated interest in Block 14K, backdated to January 1 and pending approvals.
– Last year, a fire at a production platform in Block 14 killed three people.
– The deal is expected to be immediately cash flow accretive.
– In addition to the base consideration, Energean will make contingent payments of up to $25 million per annum, capped at $250 million.
– Contingent payments will be payable through 2038, linked to future developments and oil prices.
– Block 14 assets produce around 42,000 bpd of oil in total, equivalent to 13,000 bpd net to the acquired interest.
– Energean will fund the deal through debt financing on the acquired assets and available group liquidity.
– Energean’s flagship Israeli gas fields have had to shut down twice over the past year due to conflicts in the Middle East.
– Chevron said it remains committed to other assets in Angola including Blocks 0, 33, 49 and 50, Angola LNG, the South N’Dola oilfield.
*Raechel Thankam & Shadia Nasralla; editing: Janane Venkatraman & Louise Heavens – Reuters
