Thailand’s PTT Exploration and Production Public Company Limited (PTTEP) has said that its successful acquisition of the 20 per cent stake in Oman’s Block 61 will strengthen the company’s foothold in Oman in the long run and pave the way for future investments in the Middle East.
Global energy giant BP on Monday announced that it has agreed to sell a 20 per cent participating interest in Oman’s Block 61 to PTTEP for a total consideration of US$2.6bn.
PTTEP, in a statement on its website, said that the acquisition will immediately add to the company’s petroleum reserves and sales volumes, foster its long term growth, and open up further investment opportunities in the Middle East.
PhongsthornThavisin, chief executive officer of PTTEP, said, “Since 2019, PTTEP has invested in key assets in Oman including PDO [Block 6], the largest onshore oil field in Oman, and Oman LNG. The investment in Block 61 is aligned with PTTEP’s direction of growth, focusing on highly prolific areas, and supports our strategy towards gas value chain investments as gas produced from the block will boost the availability of gas supply for Oman LNG. This successful acquisition will further strengthen PTTEP’s foothold in Oman in the long run.”
Thavisin said PTTEP MENA Limited, a subsidiary of PTTEP, has signed a sale and purchase agreement (SPA) with BP for a 20 per cent participating interest in Block 61 with a transaction value of US$2.450bn, subject to final net working capital and other closing adjustments per SPA at completion of the transaction following government approval expected within this year. The value excludes potential contingent payments which are capped at a maximum amount of US$140mn, and subject to certain milestones stipulated under the SPA being accomplished. The acquisition will be funded from cash available on PTTEP’s balance sheet, he added.
As per the Thai company’s statement, the investment in Oman’s Block 61 will have an immediate effect of increasing PTTEP’s petroleum reserves and sales volumes. Furthermore, this will also open an opportunity for PTTEP to develop a high potential project in Oman in collaboration with world-class exploration and production companies.