Dubai-based Dragon Oil is in negotiations with Dublin-based Petroceltic International to consider an all-cash offer for the issued share capital of Petroceltic.
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| Petroceltic's GSP Prometeu drilling rig operating off of Romania. From Petroceltic |
Dragon Oil has submitted an offer of approximately US$369 in cash per Petroceltic share, for a total of $785 million.
“The motivation for this deal was the geographical spread of production and exploration assets,” a company spokeswoman told the Wall Street Journal.
According to a release from Petroceltic, the completion of any offer by Dragon Oil would be subject to customary conditions for an offer for an Irish public company, as well as appropriate approvals from the Algerian Government in relation to the Algerian assets of Petroceltic. It is also subject to the approval of Dragon Oil shareholders.
Last month, Petroceltic increased its Egyptian presence when it was awarded the North Port Fouad Block, in the Egyptian Natural Gas Holding Company 2013 International Bid Round, with joint venture partner Edison International Spa. The North Port Fouad (Block 7), is offshore the Nile Delta and lies near the North Thekah Block. The combined area of both licenses is more than 7000sq km.
This came after the Petroceltic-operated Muridava-1 exploration well on the Muridava (EX-27) license in the Romanian Black Sea was plugged and abandoned after failing to find commercial hydrocarbons. The well, spudded on April 11 and drilled to a total depth of 2747m, was the first exploration well drilled by the Muridava concession owners Petroceltic (40%), Sterling Resources (40%) and Petromar (20%).
Dragon Oil secured its first operatorship outside Turkmenistan in July 2014. Production is expected to reach up to 90,000bo/d by the end of the year.
Dragon Oil’s main producing asset is the Cheleken contract area, offshore in the eastern section of the Caspian Sea.
According to Dragon Oil, between eight to 10 wells are due to be completed on the firm's Turkmeni assets by the end of 2014, helping to increase production to 87,000 to 90,000bo/d compared to the 73,440bo/d average seen in 1H 2014 (73,600bp/d in 1H 2013).
The firm also has exploration blocks in Tunisia, Iraq, Afghanistan, Egypt and the Philippines.
Read more:
Petroceltic increases Egypt foothold
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