Malaysia’s Sapura Energy and Austria’s OMV have consented to a share membership agreement and an investors’ agreement to form a strategic partnership.
Sapura and OMV entered into a head of investors’ agreement to form a strategic partnership and for OMV to procure half of Sapura Upstream back in September.
The two organizations signed to a share membership arrangement and an investors’ concurrence on Friday, November 9.
OMV said on Friday that, under the agreements, OMV Exploration and Production, an auxiliary of OMV, would purchase a half stake of the issued share capital in a recently framed joint endeavor organization, SEB Upstream Sdn Bhd (SUP).
This depends on an aggregate enterprise value of up to $1.6 billion which involves a value estimation of up to $1.250 billion and obligation of $350 million.
OMV said it would pay $540 million for a 50% interest for SUP at shutting by buying into recently issued shares. What’s more, the gatherings consented to an extra thought of up to $85 million dependent on specific conditions basically connected to the asset volume in Block 30, Mexico at the time of taking the final investment decision. Both parties have also consented to renegotiate the current inter-company debt of $350 million.
Sapura Upstream is an independent oil and gas organization situated in Malaysia with a normal existence of field production of roughly 260 mn boe and solid development prospects. Production and development resources are situated in shallow waters offshore Malaysia. Sapura Upstream’s production entitlement in 2017 was roughly 4.1 mn boe per annum, from fields in Peninsular Malaysia. Sapura Upstream has two petroleum gas investigation and production blocks offshore Sarawak in a well-developed region with the existing foundation.
Sapura’s development of the SK408 gas fields offshore Malaysia is on track and first gas is normal in 2020 with a noteworthy increase in 2023. This would prompt an expected aggregate level production privilege of roughly 21 mn boe per annum which means around 60 kboe/d. Notwithstanding its oil and gas resources in Malaysia, Sapura Upstream likewise approaches investigation blocks in New Zealand, Australia, and Mexico.
OMV benefiting from developing business sector
As a major aspect of the agreement, the administration of the partnership will be situated in Malaysia and there will be an equivalent portrayal from the two sides for the board of directors. OMV expects to completely combine Sapura Upstream in its fiscal reports. Consummation of the exchange is liable to conditions including Sapura Energy’s investor endorsement, Petronas endorsement, and other outsider assents and also finishes of the exchange records including ancillary agreements.
Rainer Seele, CEO, and Chairman of the Executive Board, OMV Group, stated: “The oil and gas request is relied upon to increment by 20% until 2030 in Malaysia and OMV is accepting the opportunities to benefit from this developing business sector. The participation will permit OMV to enter into an association with a very regarded local autonomous partnership and will support our Upstream technique towards setting up Australasia as another core area.”
Johann Pleininger, OMV Board Member Upstream and Deputy Chairman of the Executive Board: “This obtaining will add appealing reserve volumes to our portfolio and result in a noteworthy near term increment underway. As the Asia Pacific is an attractive developing business sector, Malaysia will represent OMV’s platform for further regional development.”
Tan Sri Dato’ Seri ShahrilShamsuddin, President and Group Chief Executive Officer, Sapura Energy, stated: “OMV’s extension methodology into the Asia Pacific looks good with Sapura Upstream’s long-term development targets. We trust the partnership will make supportable development for the business, acknowledging cooperative energies from both sides to accomplish our vision of making the biggest regional independent O&G Company.”