(Alliance News) - Scirocco Energy PLC's sale of a 25% non-operated working interest in the Ruvuma asset to Wentworth Resources PLC appeared to stall as the company said on Tuesday it had received notice from ARA Petroleum Tanzania Ltd exercising its pre-emption rights.
In addition, Scirocco confirmed that Tanzania Petroleum Development Corp, the national oil company of Tanzania, had indicated that it is considering exercising its statutory right of first refusal in relation to the sale.
Scirocco said it is now taking advice to understand the implications of these developments and will enter into discussions with each party to confirm the next steps.
"Current expectations based on local advice received are that these apply to any disposal regardless of counterparty. Scirocco and its advisers will work with all parties to deliver a timely completion of the transaction," said Scirocco Chief Executive Tom Reynolds.
On June 13, Scirocco entered into an asset sale agreement to divest its 25% non-operated interest in Ruvuma to Wentworth for a total consideration of up to USD16 million.
Wentworth, in a separate statement, said it remains committed to the acquisition. The company added that no payment under the loan facility arrangement has been made to Scirocco and no consideration will be due unless the acquisition completes.
Wentworth Chief Executive Katherine Roe added: "The discussions regarding a potential exercise of pre-emption rights by Scirocco's partners underline the compelling economics of the transaction we constructed, which was designed to be in the best interests of our shareholders and in-country stakeholders with a focus on driving reinvestment into the Ruvuma asset and into Tanzania."
Shares in Scirocco closed down 2.8% at 0.35 pence on Tuesday evening in London while Wentworth closed 2.3% lower at 21.00p.
By Heather Rydings; heatherrydings@alliancenews.com
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Scirocco Energy (SCIR)