Friday 21 September 2018

Verus Petroleum announced on 20 September 2018, that it has signed a Sale & Purchase Agreement (SPA) for the acquisition of Cieco Exploration & Production (UK) Limited, a wholly owned subsidiary of ITOCHU Corporation.

The consideration is $400 million (USD) with an economic date of 1 January 2018.

The acquisition includes a 23.1% interest in the Western Isles Development Project, a 25.8% interest in the Hudson field, a 2.0% interest in the Brent Pipeline System, and a 1.2% interest in the Sullom Voe oil terminal.

The acquisition will add approximately 11,000 barrels of oil equivalent per day (boepd) to Verus’ daily production. The acquired entity is an asset holding company and does not involve the transfer of any personnel.

The transaction will be funded by a combination of equity, existing cash reserves and debt. Equity will be provided by HitecVision, the majority owner of Verus. Verus’ leading lender Nedbank Limited supports the transaction and the existing Reserves Based Lending (RBL) Facility will be increased and amended to allow for the participation of a group of additional banks who are also supportive of the transaction.

The transaction is subject to customary regulatory approvals and is expected to complete in the fourth quarter of 2018.

In support of its growing business, Verus is relocating to new offices in the Silver Fin building on Aberdeen’s Union Street later this year. The move will allow Verus to bring its team together in a modern, open plan working environment that will support the ongoing expansion of its business, and further demonstrates its commitment to Aberdeen and the North Sea.