Irish oil firm agrees €14m Egypt purchase and seals BP supply deal

Irish oil firm agrees €14m Egypt purchase and seals BP supply deal

Irish exploration company United Oil and Gas has added to its burgeoning presence in Africa with a $16m (€14.3m) acquisition in Egypt.

The Dublin-based company has also signed a significant supply deal with oil super major BP.

United has acquired Egypt-based Rockhopper Energy in a reverse takeover, which - under London Stock Exchange rules - has resulted in a temporary suspension of United's shares.

The deal, expected to close in the final quarter of the year, will bring with it a 22% minority share in the onshore Abu Sennan concession in Egypt - meaning it delivers immediate first oil production to United; 1,100 barrels of oil equivalent per day and 2.64 million barrels in net reserves to be exact.

United will fund the deal partly through proceeds from the recently announced $5m sale of one of its North Sea licences; a share placing; and an $8m loan from BP.

Additionally, United has struck a deal whereby BP will have first call on any oil and gas produced from United's other licences in the UK, Jamaica and Italy.

At the end of last year, United - which is run by former Tullow Oil executives - said it would be targeting a game-changing acquisition during 2019.

In March, the company signed an option agreement to invest in an onshore licence in Benin with it saying the expansion into Africa was potentially "transformational".

Chief executive Brian Larkin used the same word to describe the new Egypt deal.

"This transaction will create a substantially larger company and this production deal will contribute to the significant development potential within our existing asset base," he said.

More on this topic

Crude oil predicted to hit $70 next yearCrude oil predicted to hit $70 next year

Rylance's decision to quit British theatre company over BP ties ‘inspired by Greta Thunberg’ Rylance's decision to quit British theatre company over BP ties ‘inspired by Greta Thunberg’

London's National Theatre ends Shell partnership as it addresses environmental impactLondon's National Theatre ends Shell partnership as it addresses environmental impact

Plan to ban oil explorers slammed as illogicalPlan to ban oil explorers slammed as illogical

More in this Section

Traders mull extent of huge sterling rally, if Brexit deal were agreed   Traders mull extent of huge sterling rally, if Brexit deal were agreed

Bord na Móna seeking opportunities to redeploy 200 staffBord na Móna seeking opportunities to redeploy 200 staff

Spelling out all the ABCs of financial jargon in plain languageSpelling out all the ABCs of financial jargon in plain language

Amazon deal with Deliveroo investigated by UK competition watchdogAmazon deal with Deliveroo investigated by UK competition watchdog


Lifestyle

We know porridge is one of the best ways to start the day but being virtuous day in, day out can be boring.The Shape I'm In: Food blogger Indy Power

Sheila O’Flanagan can’t pin down an exact number of books she has written.First lady of fiction: Sheila O'Flanagan is happy to be accessible

This might not be the most entertaining topic but it is that time of year when colds, flus and nasty bugs enter classrooms and homes.Mum's the Word: Top tips for keeping nasty bugs and illnesses at bay

Laura Whalen is a Munster-based dollmaker and mother-of-five, and the founder of the Bábóg project, a community crafting drive to make a commemorative doll for all the babies born in Irish mother and baby homes.Made in Munster: Meet the West Cork dollmaker who uses bio-degradable materials for her craft

More From The Irish Examiner