Giken Sakata plans Java oil fields acquisition
Thursday, April 17 2014 - 12:42 AM WIB
SGX-listed manufacturing firm Giken Sakata (S) Limited announced that it has on April 11, 2014 signed an MoU with Java Petral Energy Pte Ltd (JPE) for the proposed acquisition of 51% shares of Cepu Sakti Energy Pte Ltd (CSE).
JPE owns 95% shares of CSE, which holds the rights to operate and produce oil from two oilfields in the Central Java region with a total of 148 oil wells. As at the date of the MoU, the Oil Fields are producing a minimum of 300 barrels of crude oil per day.
If the MoU goes through, Giken Sakata will pay JPE $48 million, $20-25 million of which will be in the form of cash with the balance paid by Giken Sakata's shares.
Some of the conditions precedent for the deal to go through is that the Oil Fields having a valuation of no less than US$100 million, as verified by an independent qualified valuer and have a gross and net entitlement of oil reserves of approximately 10 million barrels of recoverable reserves.
CSE has signed a 10-year agreement for two oilfields with the local village cooperatives (KUD). The concession covers 148 wells in the Dandangilo-Wonocolo and Tungkul areas in East Java?s Cepu oilfield. These two oilfields have an estimated 10 mmbo of recoverable reserves. Work is already underway on 12 initial wells.