The Board of Petroceltic International plc, the oil and gas exploration, development and production company focused on the North Africa and the Mediterranean region, provided an operating and financial update, and announces that it has initiated a formal strategic review of the Company’s business and assets with a view to considering all options to maximise value for shareholders and stakeholders.
In Egypt, Petroceltic has reached an agreement to sell its interests in the North Thekah, North Port Fouad and South Idku exploration licenses to its joint venture partner Edison International S.p.A (‘Edison’) for a net cash consideration of US$9.5 million, after working capital adjustments of approximately $5.8 million. Edison is the operator of North Thekah and North Port Fouad and a joint venture partner in South Idku.
The transaction remains subject to the receipt of Government approvals and the waiver of pre-emption rights held by the Egyptian Natural Gas Holding Company (‘EGAS’) and is expected to complete in the first quarter of 2016. The sale of these interests will reduce Petroceltic’s exploration expenditure obligations in 2016 by approximately US$20 million. Petroceltic expects to record a loss of approximately $1.5 million on this transaction and the proceeds of the sale will be applied to repayment of debt.
In addition to the sale of the North Thekah, North Port Fouad and South Idku interests to Edison and the potential sale of its Egyptian production interests, as set out above, the Company has also received a number of conditional proposals and expressions of interest in relation to the sale of the Company or some or all of its assets and, in light of this, now considers it appropriate that a more formalised sale process is undertaken. Options being considered by the Board include, but are not limited to, a farm-out or sale of one or more of the Company’s existing assets, a corporate transaction such as a merger with a third party, the sale of the entire issued, and to be issued, share capital of the Company and the raising of capital in the form of debt and/or a subscription for new ordinary shares in the Company by one or more third parties.
The strategic review process may or may not result in an agreement for the sale of, all or part of the Company’s assets, an offer for the issued, and to be issued, share capital of the Company or another form of corporate transaction. As such there can be no certainty as to whether any such agreement, offer or transaction will be forthcoming or as to the terms of such agreement, offer or transaction, if any, including any requirement for shareholder approval.
(Petroceltic International plc Press Release)