United Oil & Gas Progresses On Egyptian Deal, Sells 2 North Sea Blocks

United Oil & Gas PLC on Monday reported progress with the acquisition of Rockhopper Exploration PLC's 22% interest in the Abu Sennan concession located in Egypt, and expects the deal to be completed in the fourth quarter of 2019.

On Thursday, all existing joint venture partners in Abu Sennan irrevocably and conditionally waived their pre-emption rights under the joint operating agreement. Partners in Abu Sennan concession include Kuwait Energy, which operates the site and has a 25% stake, Global Connect Ltd with 25% and Dover Investments with 28%.

In July, Rockhopper agreed to sell its subsidiary Rockhopper Egypt Pty Ltd to United Oil & Gas PLC for USD24 million, consisting of an initial USD16 million payment, and a USD8 million prepayment financing structure coming from BP PLC.

Remaining conditions for the sale includes approval from United Oil & Gas shareholders, and from the Egyptian government.

In addition, United Oil & Gas said it has signed a sales and purchase agreement for the sale of North Sea blocks 15/18d and 15/19b to Anasuria Hibiscus UK Ltd for up to USD5 million.

Anasuria will first pay USD100,000 on the signing of the agreement, and then another USD900,000 on the deal's completion. Subject to further milestones relating to the approval of the Marigold Field Development Plan, Anasuria could pay up to USD3 million to United before the end of 2020.

Once the blocks are in production, there will be potential for further production payments of up to USD1 million by Anasuria to United.

"We are confident that when we are re-admitted to AIM, later this year, we will have achieved our goal of creating a full cycle oil and gas company with exceptional prospects for growth. Our portfolio will include high impact exploration assets, low risk development opportunities, discoveries which are near to production and producing assets which show considerable potential for further reserves," said United Chief Executive Officer Brian Larkin.

Shares in Rockhopper Exploration were marginally lower at 19.10 pence on Monday, while United Oil & Gas shares have been suspended since July as the acquisition is deemed a reverse takeover under London's AIM rules.

Source: LSE