Dragon Oil has announced that it has plans to buyout oil firm Petroceltic for US$789mn to boost exploration and output in Kurdistan Region of Iraq and North Africa
Petroceltic said that it would be willing to accept the offer once Dragon Oil’s majority shareholder approved it, and if certain unspecified conditions were met.
One of Petroceltic’s main assets is Ain Tsila gas field in Algeria, where Dragon Oil recently obtained new drilling licences in a consortium with Italy’s Enel.
Dragon Oil’s main production assets are in Turkmenistan currently, Bloomberg reported.
David Round, BMO Capital Markets analyst in Ireland, said, “It looks a good deal from Petroceltic’s perspective.
“A lot of the smaller exploration and production companies are looking for an exit at the right price and this price looks pretty reasonable.”
Abdul Jaleel Al Khalifa, CEO at Dragon Oil, had said in August this year that he saw Egypt, where Dragon Oil already has an exploration license, as a prime area for growth.
The explorer expects to produce 100,000 bpd by the end of next year in Turkmenistan, according to company sources.
Adding Petroceltic would take Dragon Oil’s net daily oil and gas production to around 70,000 boepd from the approximate 45,000 boepd forecast for 2014. The increase would make it the fifth-largest UK-listed oil company by output, close behind Tullow Oil, according to Wall Street Journal.
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