Norwegian junior Panoro Energy has entered into a definitive agreement with Beender Tunisia Petroleum Limited to acquire the latter’s 40% shareholding in Sfax Petroleum Corporation (SPC) for a total consideration of approximately $18.2Million in a mix of cash and shares.
The total acquisition cost of $6 per 2P barrel.
The deal translates to an addition of almost 3Million barrels of oil of 2P reserves and net daily production of 800-900Barrels of Oil Per Day (BOPD). This increases Panoro’s full year 2023 production guidance to 9,500 to 11,500BOPD (from 9,000 to 11,000 BOPD), recognising approximately nine months of production from completion, and increases the 2023 peak target to in excess of 13,000BOPD (previously in excess of 12,500BOPD) around year end SPC, through its subsidiaries, indirectly owns a 49% interest in the producing TPS Assets which comprise five oil field concessions in the region of the city of Sfax, onshore and shallow water offshore Tunisia, including Cercina, Cercina Sud, Rhemoura, El Ain/Gremda and El Hajeb/Guebiba. SPC also holds 87.5% interest in the Sfax Offshore Exploration Permit (SOEP) offshore Tunisia.
Prior to the acquisition, Panoro’s effective ownership of SPC stood at 60% (29.4% interest in the TPS Assets and 52.5% interest in SOEP), which it acquired from OMV in 2018. Post the Acquisition Panoro’s ownership of SPC will increase to 100% (49% interest in the TPS Assets and 87.5% interest in SOEP) and SPC will be a fully owned subsidiary of Panoro.
Panoro says that the taking of Beender’s 40% ownership of SPC equates to a 19.6% interest in the producing TPS Assets and 35% interest in SOEP.
As part of the acquisition, Panoro has assumed approximately $ 4Million of Beender’s share of outstanding Tunisian loan facilities. Panoro has refinanced this Tunisian facility into its principle corporate facility, increasing total facility amounts by $9Million (separately Panoro has made Q1 loan repayments of $ 6Million). Panoro has then also assumed Beender’s share of cash and working capital equivalent to approximately $6.5Million.
The Consideration payable is inclusive of all working capital adjustments with completion expected in April 2023.
Balance sheet as of the completion date will include an additional 40% of asset and liabilities of SPC acquired at fair value and equally the results from the Tunisian operation will be consolidated at 100% Upfront consideration comprises $4.9Million cash and $ 8.3Million (“Share Consideration”) via the allotment and issue of 2,945,035 new Panoro shares at an issue price of NOK 29.18 per share (issue value NOK 85,936,092.12). Half of the Share Consideration have an agreed lock-up period of six months form the issue date, whereas the remaining 50% are subject to a lock-up of 12 months.
Deferred consideration of $ 5Million payable in cash by end 2023.
About The TPS Assets.