ShaMaran acquires TotalEnergies’ interest in Sarsang PSC in Kurdistan, Iraq

Kurdistan Iraq 16 JulyShaMaran Petroleum has signed an agreement with a subsidiary of TotalEnergies to acquire its affiliate (TEPKRI Sarsang) holding an 18% non-operated participating interest in the Sarsang Production Sharing Contract in the Kurdistan Region of Iraq 

The acquisition is transformative to ShaMaran’s production, reserves and financial profile and delivers on the company’s focused and disciplined strategy for growth by targeting this opportunity that is accretive to the company, its shareholders and its bondholders.

The acquisition is expected to double ShaMaran’s Q2 2021 average net production of 11,090 bopd following the completion of the processing facility expansion at Swara Tika field by mid-2022. Additionally, it is set to enhance ShaMaran’s oil reserves through the addition of high API and low sulphur oil that achieves a low discount to Brent.

The Sarsang block is on the northern border of the company’s Atrush block and is comprised of two producing fields: Swara Tika and East Swara Tika.  At Swara Tika, an expansion project is well underway with the addition of a new 25,000 bpd processing facility which is expected to lift gross production to approximately 50,000 bopd by mid-2022.

Through the acquisition, ShaMaran will add strong cash flow and a production growth trajectory underpinned by its interests in two cash-positive PSCs with three producing fields in the same vicinity.

ShaMaran’s president and chief executive, Dr Adel Chaouch, said, “This is a strategic transaction for ShaMaran delivering value to equity and debt holders and strengthening the financial profile of the company. Upon completion, this acquisition will add immediate material production and cash flow to ShaMaran and will provide significant value enhancement. It demonstrates our continued commitment to Kurdistan and diversifies our existing production base.”

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