Brightoil Petroleum is planning to submit a formal bid to acquire all the issued shares of Newfield Global Inc., which holds a 12% interest in Bohai Bay Block 05/36 and a 49% interest in Pearl River Block 16/05, both offshore China.
Brightoil already owns a 29% interest of the oil-producing Bohai Bay Block. According to Newfield, the Pearl River Block is under development. It is expected to start production by the end of November 2014, and it will be operated by a subsidiary of Newfield.
A bid evaluation process is expected to start shortly after the bid, and the successful bidder will enter into a definitive share purchase agreement with the seller around December 2014. If the proposed acquisition is successful, Brightoil said it would fund the project with a combination of its internal resources, allotment of new shares as well as external borrowing.
Dr. SIT Kwong Lam, Chairman of Brightoil Petroleum, said, “The Group will boost its oil and gas reserves and production if we win the bid and the Proposed Acquisition materializes. Brightoil is devoted to establishing itself as a resource-focused international oil and gas enterprise through organic growth and acquisitions of quality upstream assets. In particular, the recent downward trend of global oil price offers us valuable acquisition opportunities. Going forward, we will continue our upstream expansion strategy to enlarge our oil and gas assets so as to deliver greater returns to shareholders and investors.”
“Since the beginning of this year, there have been a number of breakthroughs in our upstream expansion. We completed the acquisitions of two premier offshore oil-producing blocks in Bohai Bay in August. In addition, the evaluation done by DeGolyer and MacNaughton (“D&M”), an authorized independent, professional valuer based in the US, showed a substantial increase of 28.5% in the Proved plus Probable (“2P”) gas reserve in Dina 1 and Tuzi gas fields. Together with our 2P reserves of approximately 42 million barrels of oil equivalent (“boe”) at the Caofeidian Project in Bohai Bay, the Group’s aggregate 2P reserves reach approximately 93.9 million boe, laying a solid foundation for our sustainable development,” Dr. SIT Kwong Lam said.