28th Feb 2020 16:28
(Alliance News) - United Oil & Gas PLC said Friday it has completed the purchase of Rockhopper Egypt Pty Ltd from Rockhopper Exploration PLC for USD16 million.
Rockhopper Egypt holds a 22% non-operated interest in the Abu Sennan concession, where production averaged 7,900 barrels of oil equivalent per day in the first half on February.
Abu Sennan includes a large exploration area, UOG said, and the other partners are Kuwait Energy, which operates the site and has a 25% stake, Global Connect Ltd with a 25% interest and Dover Investments with a 28% holding.
The oil & gas exploration and development company had announced the "truly transformational" acquisition of Rockhopper Egypt back in July last year.
The company had said it would pay USD16 million, with a USD8 million prepayment financing structure coming from FTSE 100-listed oil firm BP PLC.
As part of the financing from BP, UOG has also signed an offtake agreement with the company.
UOG had said it would raise cash through a share issue to fund the rest of the deal, without specifying how much it would raise. If there was a shortfall between the amount raised, the already paid cash element, and the USD16 million total, UOG would make it up by issuing shares directly to Rockhopper.
In December, UOG had said it conditionally raised USD6.3 million, to part-fund the acquisition, through the issue of 159.0 million new shares at 3 pence per share.
UOG said it would also will issue 114.5 million new shares worth USD4.5 million to Rockhopper Exploration. The 114.5 million shares represent around 19% of UOG's enlarged share capital.
Brian Larkin, chief executive officer, said: "Completing the acquisition of Rockhopper Egypt represents a significant milestone in the development of United, establishing the company as a full-cycle exploration & production company, and putting us in a strong position for further growth."
In a separate statement, Rockhopper Exploration confirmed the disposal of Rockhopper Egypt and noted that it is anticipated that Rockhopper Chief Financial Officer Stewart MacDonald will be appointed as a non-executive director of UOG.
UOG shares were suspended as the acquisition had been deemed a reverse takeover under AIM rules, but was re-admitted to trading on AIM on Friday.
UOG shares were trading 6.1% lower in London at 2.70 pence each on Friday shortly before market close, meanwhile Rockhopper shares were trading 13% lower at 13.12p.
By Loreta Juodagalvyte; [email protected]
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