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Oil & Gas

SDX Energy confirms talks with BP to acquire assets in Egypt

Posted: September 21, 2018 at 6:11 pm   /   by   /   comments (2)

UK player confirms media report that is it in discussions over ‘significant package of assets’.

North African-focused oil and gas company SDX Energy on Thursday confirmed that it was in discussions with BP Plc to buy a package of assets in Egypt.

London-listed SDX said the acquisition would constitute a reverse takeover.

SDX said its shares have been suspended from trading on London’s junior market, AIM, with immediate effect and will remain suspended until an admission document has been published or the company confirms that a deal is not proceeding.

A spokeswoman for BP declined to comment on the talks with SDX.

Reuters reported earlier in the year, citing banking sources, that BP is seeking buyers for its stake in a 50-year-old oil and gas business in Egypt, then estimated to be worth around $500 million.

It was not immediately clear which assets SDX was in talks with BP over.

Earlier in the day, oil and gas explorer and producer SOCO International said it signed a deal to buy privately-owned Merlon Petroleum El Fayum Company for about $215 million. Merlon holds the operated working interest onshore El Fayum in Egypt.

(Source: Reuters)

Background: Reuters reported in March that BP was already meeting with prospective buyers for its stake in its 50-year-old JV with the EGPC, the Gulf of Suez Oil Company (GUPCO), as part of a plan to sell USD 2-3 billion’s worth of maturing assets this year in an effort to shore up finances and shift focus to natural gas. Sources had then valued the GUPCO transaction at $500 million but others had said that BP was hoping to raise as much as $1 billion from the sale.

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  • September 24, 2018 at 9:20 am Mike B Porter

    Your article says that BP wishes to dispose of maturing assets and concentrate on gas production in Egypt. Does this mean in your opinion that gas assets owned by GUPCO are excluded from the sale?
    Also could you have a stab at which maturing oil assets are involved in the sale and what the effect on GUPCO staff would be?

    • September 29, 2018 at 12:03 pm Energy Egypt

      Good question Mike. When news emerged in March that BP was looking to sell GUPCO, it was understood that the sale was of the whole entity. BP’s focus, according to Reuters, was to shift to “newer deepwater gas fields off the country’s Mediterranean coast”. SDX negotiations are for a ‘significant package of assets’ from BP, but there is no further information at the moment.