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(Alliance News) - Longboat Energy PLC on Wednesday said it bought privately-held firm Topaz Number One Ltd, which it said marked the expansion of its business in south-east Asia.
This is because the Norway and Malaysia-focused full-cycle exploration and production company noted that Topaz's sole asset is a working interest of just under 16% in block 2A offshore Sarawak in Malaysia, which contains the "giant" Kertang prospect.
Longboat Energy said the acquisition will be satisfied in three tranches: the issue of new shares worth USD100,000 upon completion; USD125,000 paid in cash or further issue of new shares upon an exploration well being committed on block 2A or a farm-out; and USD3.0 million paid in cash or new shares upon a discovery being made on block 2A, depending on the resource size and the growth in share price measured over a two-year period.
The acquisition remains subject to customary regulatory and partner approvals, Longboat Energy said.
Following the completion of the transaction, Longboat Energy said it will hold an operated interest in the production sharing contract over block 2A of just under 53%, "simplifying the process towards a positive well decision and the potential introduction of an additional funding partner prior to drilling".
Partners Petronas Carigali Sdn Bhd and Petroleum Sarawak Exploration & Production Sdn Bhd have 40% and 7.5% interests in the production sharing contract respectively.
The Topaz team, comprising Owners & Founding Directors James Menzies and Pierre Eliet, will join Longboat Energy, which Longboat Energy said would bring "extensive regional expertise and an established network, accelerating Longboat's ambitions to build a full cycle [exploration and production] business in [south-east] Asia".
"We are pleased to have increased our interest in the extensive and prospective Block 2A in deep water Sarawak, which contains the giant Kertang prospect. Sarawak has seen significant exploration success in recent years, and we are excited to play a role in the quest for additional gas resources in the area," said Longboat Energy Chief Executive Officer Helge Hammer.
"We welcome James and Pierre to Longboat. Their extensive experience and network from [south-east] Asia combined with our in-house technical expertise, puts us in a strong position to deliver accelerated growth in the region. In parallel with maturing block 2A towards the drilling decision, we focus on adding production and development assets to our portfolio in [south-east] Asia."
Shares in Longboat Energy were up 6.8% to 24.56 pence each in London on Wednesday morning.
By Greg Rosenvinge, Alliance News reporter
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