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IFC-led consortium buys into Pacific Rubiales pipeline subsidiary

17th December 2014

Pacific Rubiales Energy has executed definitive agreements with the International Financial Corporation (IFC), a member of the World Bank Group, the IFC Global Infrastructure Fund and a consortium of investors, to sell approximately 43 per cent of its interest in its pipeline and power transmission entity Pacific Midstream

IFC-led consortium buys in to Pacific Rubiales pipeline subsidiary
'The participation by IFC underlines the strategic importance and value of our infrastructure assets in Colombia' - Pacific Rubiales CEO

The agreements will provide Pacific Rubiales with USD 240m in cash, which will be received by year-end. In addition, Pacific Midstream will receive USD 80m in the first quarter of 2015, plus a commitment for an additional USD 60m in cash to develop future infrastructure projects.

"We are pleased to announce this sale, which will significantly improve our cash position and provide additional flexibility as we enter into an uncertain oil price environment in 2015,” said Ronald Pantin, chief executive officer of Pacific Rubiales.

“The participation by IFC underlines the strategic importance and value of our infrastructure assets in Colombia. We will continue to hold a majority interest in Pacific Midstream and capacity rights in its assets, allowing us to maintain the cost advantages that we currently enjoy with respect to crude oil transportation and low cost electricity in our main oil fields in Colombia.

"Our financial and capital strategy is focused on maintaining a healthy balance sheet and ensuring funding for our future growth, while generating strong returns to our shareholders.

“In light of the current weaker commodity price environment, we continue to evaluate all of our capital expenditure programs and we have additional flexibility to scale back capital spending, as well as opportunities for further cost savings.

“We will continue to monetise our midstream assets and plan to sell certain non-core exploration and production assets, the proceeds from which will be used to reduce debt."

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