17th Jun 2014 10:06
LONDON (Alliance News) - Aminex PLC Tuesday said it has completed the sale of its US business to US-focused oil and gas company Northcote Energy Ltd and Springer Oil and Gas LLC for a total of USD5 million in cash and shares.
The move of Aminex selling its US business, first announced last month, leaves the company focused entirely on Africa with its assets in Tanzania, some of which are on the verge of producing. The portfolio of assets sold mainly comprise the Shoats Creek field in Louisiana and the Alta Loma field in Texas.
The oil and gas company said that the sale now allows it to pay down part of its loan facility and provides further flexibility for working capital.
Under the terms of the deal, Aminex will receive USD150,000 in cash and USD350,000 worth of AIM-listed Northcote Energy shares, at a price per share still to be set, and a production payment of USD10 a barrel until it has recovered a further USD4.5 million. The production payments will start on January 1, 2015.
Northcote and Springer have also agreed to invest a minimum of USD1 million in development capital into the US assets over the next year to boost production, Aminex said.
Aminex said that as another term of the deal, if Northcote or Springer choose to sell of any of their interests in Aminex USA, Aminex will receive 50% of the proceeds and up to a maximum of USD1.5 million against the outstanding balance of the production payment, while the production payment will remain a continuing obligation.
Aminex said it can now focus full on its business in Tanzania.
"We continue to be confident that first gas production from Kiliwani North will begin in early 2015 and look forward to updating the market during the third quarter of 2014 on the results of the new seismic programme at our Ntorya-1 discovery. We also watch the upcoming drilling from other operators in the Ruvuma Basin with interest," said Chief Executive Jay Bhattacherjee in a statement.
In a statement last month, Northcote Energy said Springer Oil & Gas would be buying all the Aminex US business, and it would then buy a 70% interest in the Shoats Creek oil field in Louisiana from Springer, and simultaneously farm-out half the interest to North American Petroleum PLC on the same terms, leaving it with a 35% stake.
North American Petroleum confirmed in a statement Tuesday that it will acquire a 35% working interest in Shoats Creek from Northcote Energy.
Shares in Aminex were trading 1.3% lower at 0.879 pence Tuesday morning, while Northcote Energy shares were down 4.2% at 0.901 pence.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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