Thailand’s PTT Exploration and Production Public Company Limited or PTTEP today signed Share Purchase Agreements (SPAs) to acquire 100% equity stakes of the subsidiaries of Hess Corporation in Thailand, namely Hess Thailand Holdings II Limited (HTH) and Hess Exploration Thailand Company Limited (HETCL).
The subsidiaries HTH and HETCL own 15% interest in block B12/27 (mainly in Pailin , Morakot and Ubon fields) and block G7/50 of Contract 4 Project and 35% interest in Block EU-1 and Block E5 North of Sinphuhorm Project respectively.
The total consideration of transaction is approximately USD 1,000 million which will be funded by PTTEP’s cash. The transaction of HTH closed on April 22, 2014 while the transaction of HETCL is expected to be closed within May 2014 as prescribed in the SPA.
“The acquisition of Hess Corporation’s interests in Contract 4 and Sinphuhorm Projects is a strategic fit to PTTEP growth strategy by adding producing assets, accretion of volume growth and reserves, and strengthening our investment in Thailand,” said Tevin Vongvanich, President and CEO.
After the acquisition, PTTEP production volume will be increased approximately 17,000 barrels of oil equivalent per day.
Contract 4 Project is a natural gas field located in the Gulf of Thailand (offshore of Songkhla Province), covering an area of 3,118 square kilometers. The current production is approximately 387 million cubic feet per day of natural gas and 17,528 barrels per day of condensate, with a total proved and probable reserves (2P) of 461 million barrels of oil equivalent (BOE).
At present, PTTEP is a partner of the project and holds 45% interest. After the accomplishment, PTTEP interest in Contract 4 Project will increase to 60% while Chevron Group will retain the operatorship of the project.
Located in Udon Thani and Khon Kaen provinces in the northeast of Thailand cover an area of 231.6 square kilometers, Sin Phuhorm Project is also a natural gas field with production of 113 million cubic feet per day of gas and 496 barrels per day of condensate.
The total proved and probable reserves (2P) are around 45 million barrels of oil equivalent (BOE). PTTEP is currently a partner of the project with 20% interest and after the accomplishment of the transaction the company will increase its interest to 55% and will become the operator of the project.
At present, PTTEP has invested in over 40 petroleum exploration and production projects in Southeast Asia, Middle East, Africa, Australia, North America and, now, also in the South America continent.