Energean announced that it will acquire Chevron’s interests in two offshore oil blocks in Angola for a base price of $260 million, as the Mediterranean gas producer moves ahead with plans to establish a stronger presence in West Africa.
Energean has stepped up investment to increase production following recent geopolitical disruptions. The company is also reviewing new merger and acquisition opportunities across the region as it works to broaden its asset portfolio.
Under the agreement, Energean will acquire Chevron’s 31% operated stake in Block 14 and a 15.5% non-operated interest in Block 14K. The transaction will be effective from January 1, subject to regulatory approvals.
A fire at a production platform in Block 14 last year resulted in the deaths of three workers, highlighting operational risks linked to the asset.
Energean expects the acquisition to generate immediate positive cash flow once completed.
Beyond the initial payment, Energean may make additional contingent payments of up to $25 million annually, with total potential payments capped at $250 million.
These contingent payments could continue through 2038 and will depend on future project developments and oil price performance.
The Block 14 assets currently produce about 42,000 barrels of oil per day in total, with roughly 13,000 barrels per day attributable to the acquired interests.
Energean plans to finance the purchase through debt tied to the acquired assets alongside existing group liquidity.
The company’s main gas fields in Israel experienced two shutdowns over the past year due to regional conflict, prompting efforts to diversify production geographically.
Chevron stated that it will maintain its presence in Angola through other holdings, including Blocks 0, 33, 49, and 50; the Angola LNG project; and the South N’Dola oilfield.
source: www.reuters.com
African Energy Council