Petroleum Africa
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Thursday, February 23, 2017
Panoro Energy’s fully-owned subsidiary, Pan-Petroleum Gabon (PPGBV), has entered into a definitive Sale and Purchase Agreement (SPA) with BW Energy Gabon (BWEG), a subsidiary of BW Offshore. Under the terms of the SPA, Panoro will sell a 25% working interest in the Dussafu PSC in Gabon to BWEG for a cash consideration of $12 million.
At closing of the transaction, Panoro will receive $11 million in cash. The remaining $1 million in cash will be paid no later than December 30.
Panoro will also receive a non-recourse loan from BWEG of up to $12.5 million at a 7.5% annual interest rate in order to fund all expenditures through to first oil production at Dussafu. Post-completion, Panoro will retain an 8.33% working interest in the Dussafu PSC. The total gross capital expenditure to reach first oil in 2018 is estimated to be a maximum of $150 million.
The closing of the transaction is subject to customary conditions precedent, including but not limited to the approval of the Gabonese government and the completion of the separate sale of Harvest Dussafu to BWEG. It is expected that the transaction will close in the first quarter of 2017.
The is the second deal in Africa to involve one of BW Offshore’s subsidiaries, earlier this month the company entered into an agreement that gives it operatorship and a 56% stake in Namibia’s Kudu License.
Julien Balkany, Chairman of Panoro, said, “Panoro is very enthusiastic about this landmark transaction and our new innovative partnership with BW Offshore to create shareholder value.”
John Hamilton, Chief Executive Officer of Panoro, said, “Since entering the Dussafu concession in 2008, Panoro has drilled two discovery wells and acquired extensive seismic data. We are thrilled to see the development finally moving forward together with our new operating partner, BW Energy. This transaction strengthens our balance sheet with additional cash, and the non-recourse loan for the Dussafu development limits our financial exposure through to first oil.”
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