Apollo Luz Complexity Asset Swap4 Mar 2019 20:44
Talos under Apollo supervision has already undertaken asset swaps on current Mexican assets - Quote Talos, Hokchi swap interests offshore Mexico U.S. oil firm Talos Energy has signed an agreement with Hokchi Energy to cross-assign Talos’ Participating Interest (“PI”) in Block 2 and Hokchi’s PI in Block 31, both in the Sureste Basin offshore Mexico. Under the agreed conditions for the swap, Talos will assign a 25% PI in Block 2 to Hokchi in exchange for a 25% PI in Block 31, which sits immediately to the south of Block 2. Once the transaction is completed, Hokchi will be the operator of both blocks and Talos will own a 25% PI on Block 2 and a 25% PI on Block 31.
Talos was awarded the Production Sharing Contract (“PSC”) for Block 2 in September of 2015. Hokchi, a subsidiary of Pan American, was awarded the PSC for Block 31 as part of a competitive bidding process on Round 3.1 in June of 2018.
Apart from the Block 1, Talos is the operator of Block 7, where it is working to develop the world-class Zama discovery made in 2017. CEO of Talos: “On both of our Mexican assets, we are taking action to facilitate quicker, more robust investment and shorter cycle time to production, and potentially a more material level of production.” “The swap with Hokchi is a great way to pool resources between two operators that have a proven track-record in offshore Mexico. And this trade also allows us to aggregate our neighbouring opportunities. We look forward to working alongside the Pan American team on Blocks 2 and 31 while we focus our operational efforts not only on Zama but the other material opportunities we have put together on the Block 7 acreage.”
The key here is - deals done on UNPROVEN ASSETS - encompassing future developments. I think Apollo want to ring fence a massive Mexico basin presence, we are well placed, NO RI, Limited debt, yes GS are keeping us down to shut the door on RI thank God. If we include all our Mexico assets is a straight swap, with a modest debt top up, don't know about Decoms. But the profit PMO stand to make can't get lost in tax, so hand Over to Apollo Masters of Complexity FFS. Bottom line if are moving our newly acquired assets that quickly for hundreds of millions TD is a great man. All the ingredients for a recipe are there, all you need is the imagination and a willingness to co-operate. TD is a Chartered accountant from a top firm, showed this in the refin, this is a bang on ripe for a deal, where Apollo will get their cut no doubt, but exiting such a deal, If PMO can monetise such a virgin deal for material gain - this is equity capital injection - the exact opposite of a RI, in an asset swap we monetise through conversion of the assets potential and future earnings stream - perfect. That's why S are there - anchoring exceptional profits if it comes off. IMO DYOR HNY . GLA I think its a win win and GS are there to collar a deal
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