BW Energy and Maurel & Prom have jointly agreed to acquire a 20% share in two blocks operated by Chevron offshore Angola, marking BW Energy’s entry into exploration and production offshore Angola.
The seller is Azule Energy, the joint venture in southwest Africa between bp and Eni. Following completion of the transaction, which is anticipated next year, both BW Energy and Maurel & Prom would hold 10% interests in Block 14 and its nine producing deepwater fields, and Block 14K, which contains a tieback to Block 14.
BW Energy’s CEO, Carl Arnet, described the acquisition as a key step in the company’s West Africa growth strategy, providing further diversification of the resource base. He noted that the company sees clear upsides beyond the current production in Block 14 and, more importantly, the deal builds a position for potential future operated development opportunities in the country.
Arnet emphasized that Angola is a mature hydrocarbon basin with an active mergers and acquisitions market and strong political support for the energy sector. He sees attractive opportunities for BW Energy to apply its strategy of developing proven reserves and stranded assets through the reuse of existing energy infrastructure to unlock significant value over time.
The license for Block 14, where production started in 1999, presently runs through 2038. Current overall production is about 40,000 barrels per day. BW Energy estimates its net share of reserves, assuming ratification of the deal by Angola’s authorities, at 9.3 million barrels. However, there are other identified opportunities to increase recoverable volumes. Abandonment and decommissioning costs are covered by existing conditions.
Azule Energy valued the transaction with the two companies at up to $310 million, including deferred contingent payments of up to $115 million. Azule Energy CEO Joseph Murphy added that the sale was in line with the company’s strategy of focusing on its core assets in Angola.
Chevron is the operator of and holds a 31.3% interest in the Lianzi Unitization Zone, located in an area shared equally by Angola and the Republic of Congo. The Lianzi project is reflected in the production totals in Angola (Block 14) and in the Republic of Congo.
The company operates the Kudu license to the south offshore Namibia, where it recently drilled the Kharas appraisal well.
Source: offshore-mag.com, oilreviewafrica.com