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LONDON (Alliance News) - The Parkmead Group PLC said Monday is has signed a USD11.2 million agreement to acquire a 20% stake in UK Production licence P.1293, which contains the Athena oil field.
The deal with EWE Vertrieb GmbH will see Parkmead extend on its current 10% stake in the site; trebling its holding to 30%. The company already holds an interest in the field following its acquisition of Lochard Energy Group PLC in July 2013.
The USD11.2 million deal will be satisfied through a cash payment of USD8 million and USD3.2 million in new Parkmead shares, to be calculated based on the closing price of a Parkmead Share on the business day immediately prior to completion, said the company.
The Athena oil field is currently producing at a reduced rate of approximately 7,500 barrels of oil per day, following some pump operational issues, said the firm, noting that work is planned for 2014 to increase production to normal levels.
Production at Athena averaged approximately 9,000 barrels of oil per day in Q2 2013. Parkmead's increased interest in the field will provide the firm with significant growth in production revenues and operating cash flows, it said.
The acquisition of the additional interest in the Athena field fits with the company's stategy to become a key player in the North Sea. The Group has been awarded a total of 30 blocks spanning eight licences across the UK, through the 27th Licensing Round, including high potential areas West of Scotland and West of Shetlands.
Shares in Parkmead were up 1.32% at 231 pence per share Monday morning.
By Alice Attwood; aliceattwood@alliancenews.com; @AliceAtAlliance
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