Australia’s Tap Oil will not be selling a share in what it describes as its flagship asset, the Manora field in the Gulf of Thailand.
In a statement on Monday, Tap Oil said it had completed a strategic review of its business and asset base, initiated earlier in 2015 in response to the significant change in market conditions affecting the oil and gas sector.
The strategic review considered a number of divestment options for each asset, including the Mubadala Petroleum-operated Manora Oil
Development. Tap Oil had also considered a sale of the company’s Australian portfolio as well as ‘whole of company’ proposals.
The strategic review process confirmed that there is considerable interest in the Company’s Manora asset, Tap said. However, the depressed oil price environment and the ongoing payment disputes between the Company and its major shareholder Mr Chatchai Yenbamroong’s Northern Gulf companies have added to the complexity of successfully executing any transaction at an acceptable price, Tap Oil said.
“After carefully considering all of the available options, the Board strongly believe the best outcome for shareholders in the current market conditions is to retain its interest in the Manora asset and its current portfolio of assets in Australia and Myanmar,” the company said in a statement.
According to Tap, the plan is now to maximize the value of Manora through near field exploration and the progression and evaluation of growth and acquisition opportunities in the South East Asian region, including Tap’s 95% interest in the M-7 block in a highly prospective hydrocarbon region, offshore Myanmar.
Furthermore Tap signed a mandate signed with Macquarie for a US$55 million facility in order to refinance its existing debt. This is expected to close by October 31, 015 .
Managing Director and CEO, Troy Hayden said: “We are very pleased with the level of interest shown in Manora during the strategic review process, which confirms the high quality nature of our flagship project. However, the current oil market conditions and the ongoing disputes with Northern Gulf made it challenging to execute a transaction that would maximise value for all shareholders.”
Tap Oil on Monday also revealed its first half 2015 number. The company’s revenues grew 376%, with production at Manora, to $55.4 million. Tap said that Manora revenues were US$44.0 million which consisted of 23 oil liftings totalling 798,875 bbls sold at an average of US$55/bbl.
The Australian independent reported net loss after tax of $17.4 million after $24.4 million in exploration write downs/impairment.