Petroleum Africa
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Monday, December 26, 2016
Harvest Natural Resource, Inc. (HNR) is exiting its assets in Gabon. The company and its wholly owned subsidiary, HNR Energia B.V., entered into a Sale and Purchase Agreement with BW Energy Gabon Pte. Ltd. out of Singapore to sell all of its Gabonese holdings.
Under the terms of the Sale and Purchase Agreement, BW Energy Gabon will acquire HNR Energia’s 100% interest in Harvest Dussafu B.V., which owns a 66.667% interest in the Dussafu PSC offshore Gabon. BW Energy Gabon will pay HNR Energia $32 million in cash for the interest, subject to certain adjustments. BW Offshore Singapore Pte. Ltd, an affiliate of BW Energy Gabon and BW Offshore Ltd., has guaranteed the obligations of BW Energy Gabon under the Sale and Purchase Agreement.
At the closing of the transaction, $2.5 million of the $32 million purchase price will be deposited in escrow, to be held for up to six months to satisfy any post-closing claims the purchaser may have for any breaches of warranties made by Harvest and HNR Energia under the Sale and Purchase Agreement.
Net proceeds of the transaction are expected to be approximately $ 29.7 million, without giving effect to any payments to the purchaser under the escrow arrangements and taking into consideration taxes and transaction-related costs.
Harvest previously announced that it is evaluating a possible dissolution and with the sale of the Gabonese assets the company’s board has decided to move forward with the dissolution. The dissolution is subject to the board’s adoption of a formal and authorization by Harvest’s stockholders. Under the dissolution, liquidation and winding up process under Delaware law, the proceeds from the Gabon transaction would be combined with other Harvest assets to be distributed to Harvest’s stockholders, subject to certain payments and costs. These costs would include dissolution expenses, taxes and payments related to terminations of employment, as well as funds to establish reserves for the payment of current and possible future liabilities of Harvest.
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