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Petroceltic announces Isarene PSC farmout to Sonatrach

08th July 2014

Petroceltic International has announced the completion of its sale of an 18.375 per cent interest in the Isarene PSC in Algeria to state-owned Sonatrach

Petroceltic announces Isarene PSC farmout to Sonatrach
The terms of the agreement with Sonatrach provide for a consideration of up to a maximum amount of USD 180m

The assignment was effected by way of a sale and purchase agreement, under which Sonatrach has acquired a further 18.375 per cent interest in the Isarene PSC covering Blocks 228 and 229a.

“We are delighted to announce the completion of the Sonatrach farm-out,” said Brian O’Cathain, chief executive of Petroceltic. “Petroceltic has had a positive and mutually beneficial relationship with Sonatrach throughout the exploration, appraisal and now development phases of the Isarene PSC. The formal ratification of this agreement is a critical step in the overall funding plan for this development project. As development operations ramp-up, we look forward to continuing to work with Sonatrach and Enel to deliver the Ain Tsila Project and to maximise the value of this important national resource for Algeria”

The amendment to the Isarene PSC required to give effect to the transfer was signed by Sonatrach, Petroceltic and Enel at a ceremony in Algiers on 12 February 2014.

This was subsequently ratified by the Algerian council of ministers and completion occurred with the publishing of the amendment on 18 June 2014 which was made available publically on 7 July 2014.

The terms of the agreement with Sonatrach provide for a consideration of up to a maximum amount of USD 180m. The consideration comprises USD 20m payment on this completion of the transaction, a further USD 140m payment of Petroceltic’s share of Ain Tsila project development cost from the effective date of 4 July 2013, and contingent payments of up to USD 20m based on the achievement of certain project related milestones.

Post completion, Petroceltic has a 38.25 per cent interest, Sonatrach has a 43.375 per cent interest, and Enel maintains its 18.375 per cent interest. Petroceltic remains operator of the licence.

 

 

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