![[Angola] Maurel & Prom to acquire 20 per cent stake in two AJOCO oil blocks](Images/2018/10/maurel and prom.PNG)
[Angola] Maurel & Prom to acquire 20 per cent stake in two AJOCO oil blocks
International oil company Etablissements Maurel & Prom has announced the signature of a sale and purchase agreement for the acquisition of the 20 per cent working interest owned by Angola Japan Oil Co., Ltd. , a majority owned subsidiary of Mitsubishi Corporation, in two blocks offshore Angola, Block 3/05 and Block 3/05A.
Michel Hochard, Chief Executive Officer of Maurel & Prom, declared: "This transaction is an important milestone for Maurel & Prom's growth strategy, and it highlights our capacity to react to M&A opportunities. This provides immediate production diversification in proven assets, with a strong track record and upside potential. We are very happy to start a new chapter of M&P's history in Angola, a major oil and gas jurisdiction in Africa with exciting opportunities ahead as the local oil industry is undergoing a major regulatory and institutional reshaping. Finally, this transaction initiates the value creative M&A strategy of M&P as the international development platform of Pertamina."
The transaction consideration is $80 million, funded from M&P's existing cash resources, with an additional contingent consideration of up to $25 million subject to oil price performance and resources development.
Closing of the acquisition remains subject to a number of conditions, in particular the obtainment of the required government approvals and waiver of applicable pre-emption rights. A further announcement will be made in due course.
Blocks 3/05 and 3/05A are located in shallow water (c.100m depth) in the Congo Basin, a region where M&P has extensive current and historical presence. The two blocks are located c.30km from the Angolan shore and operated by national oil company Sonangol Pesquisa e Produção ("Sonangol P&P"). The blocks are contiguous and share processing and export facilities.
Block 3/05 has been producing since the mid-1980s and consists in eight mature fields (Bufalo, Cobo, Impala, Impala SE, Oombo, Pacassa, Palanca, and Pambi) and the net production to the 20% working interest in 2018 estimated by M&P is c.4,600 bopd. Current licence runs until June 2025, with a possibility to extend.
Block 3/05A includes two commercial fields (Caco and Gazela), and offers optionality through the Punja field, a large discovery in pre-development stage.
