Indago Petroleum (IPL) has sold its entire Oman production and development assets for a reported £194 million (US $374.3 million). The sale is worth more than the entire company.
UAE company, RAK Petroleum will assume control of Blocks 8 and 30, located offshore and onshore Oman, as well as a 50% share of Blocks 31, 43A and 47, onshore Oman.
“Essentially we’re replacing the whole of IPL with RAK Petroleum as the owner,” said Peter Sadler, CEO of Indago, who will step down from the board of Indago and transfer to RAK Petroleum. “We have sold our Oman portfolio because the deal we were offered was worthwhile for our shareholders. RAK Petroleum originally wanted to buy the whole company but didn’t value the exploration as highly as we and our shareholders did. What the company did value was the production and development assets, so there was an opportunity to satisfy both parties.”
The deal is the equivalent of 72.5 pence per share, of which 60 pence, or £160 million, will be paid to shareholders in the form of a special dividend. Shareholders will receive payment on 18 April 2007.
Despite the deal, Sadler said Indago will retain its status as a listed exploration company.
“Indago has between US $55-60 million in the bank and we will use that to fund the exploration programme for our remaining blocks,” said Sadler.
The terms of the production sale dictate that all Indago’s exploration blocks in Oman and the UAE will be split equally with RAK Petroleum, but Sadler said this would not prevent RAK from operating on its own.
“RAK Petroleum has other ambitions in the region and are looking at other acquisitions,” he said.
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