Sequa Petroleum N.V. (“SPNV”) is pleased to announce that Sungara Energies Limited (“Sungara”) has entered into an agreement with Sonangol Pesquisa E Produção, S.A. (“Sonangol P&P”) to purchase a 10% participating interest in Block 15/06, 40% participating interest in Block 23 (with operatorship), and 35% participating interest in Block 27 (the “Transaction”). Sungara is jointly owned by three partners: the National Petroleum Corporation of Namibia’s subsidiary NAMCOR Exploration and Production (Proprietary) Limited (“Namcor”), Petrolog Energies Limited (“Petrolog”, a company affiliated with African multinational Petrolog Group), and SPNV’s subsidiary Sequa Petroleum UK Limited (“Sequa”).
Sungara is a new entity with a focus on Sub-Saharan African upstream oil and gas, combining world-class technical expertise with local capability and commitment, able to operate and develop oil and gas assets throughout the region in line with the highest standards of integrity, quality, governance and responsibility. Concurrent with the Transaction, NAMCOR, Petrolog and Sequa have signed a shareholder agreement relating to their interests in Sungara, with equal terms and shareholdings in Sungara for each partner. A general meeting of shareholders of SPNV will be convened to approve its entering into the Sungara partnership.
The Block 15/06 Joint Venture comprises Eni (operator, 36.84%), Sonangol P&P (36.84%) and SSI Fifteen Limited (26.32%). Block 15/06 is one of the most prolific blocks in deepwater offshore Angola with current oil production of more than 100,000 barrels per day through two large floating production and storage facilities. Following successful exploration and appraisal in the past several years, an ongoing development programme is forecasted to increase production in the medium term beyond 150,000 barrels per day. The block has further upside potential which may materialise following future exploration, appraisal and development activity.
Sungara’s 10% participating interest in Block 15/06 provides it with current production of more than 10,000 barrels of oil per day, forecasted to grow beyond 15,000 barrels per day in the medium term, 75 million barrels reserves and resources, and further upside potential. Offshore exploration Blocks 23 and 27 also provide upside value. The consideration for the Transaction is ca. USD 500 million which includes a contingent payment of up to USD 50 million. The Transaction is planned to be funded by Sungara through a combination of equity contributions from each of the Sungara partners and third party debt. The economic effective date of the Transaction is April 2022 and completion, subject to customary conditions and approvals, is planned to occur in 2022.