Petroceltic International plc, the upstream oil and gas exploration and production company focused on North Africa, the Middle East and the Mediterranean, is pleased to announce the completion of its sale of an 18.375% interest in the Isarene PSC to Enel Trade SpA (Enel).
Under the terms of the agreement ENEL has:
- Agreed to pay up to US$36.75 million to Petroceltic, which equates to 24.5% of all back costs incurred from signing of the PSC in 2005 until the end of the exploration period in April 2010;
- Committed to fund 49% of the cost of the recently completed six well Isarene appraisal drilling campaign, which costs are capped, in aggregate, at US$145 million; and
- Agreed to pay Petroceltic a contingent cash consideration, up to a maximum of US$75 million, such amount determined by a number of factors based on the results of the appraisal programme, such as the overall level of reserves and the production profile.
Amounts outstanding under this agreement or to be paid under cash call arrangements currently exceed US$101 million and are now due for settlement within 30 days. Any contingent consideration amounts payable will fall due upon approval of the Declaration of Commerciality by the Algerian authorities, which is expected later in 2012.
Post - completion, Petroceltic operates the permit with a 56.625 % interest, Sonatrach maintains a 25% interest, and Enel holds an 18.375% interest.
Brian O'Cathain, Chief Executive of Petroceltic, commented: "We are delighted to announce the completion of the Enel farmout and formally welcome our new partner to the Isarene Licence. Since announcement of the deal in April 2011 we have forged a valuable and co-operative working relationship with Enel and Sonatrach, culminating in the completion of the highly successful appraisal campaign. We look forward to a long and successful relationship in this outstanding asset."