PETALING JAYA: Dagang Nexchange Bhd (DNex) is making its way to become an oil and gas (O&G) exploration company with its plans to buy 70% stake in Ping Petroleum Ltd, which has a stake in the production in the Anasuria cluster in the UK North Sea.
In a filing with Bursa Malaysia yesterday, DNex said it has entered into a heads of agreement (HoA) with Ping to acquire the remaining shares it does not own.
At the moment, DNex owns 30% stake in Ping through its associate company DNeX Energy Sdn Bhd.
“The HoA is not legally binding and is subject to the signing of the definitive SPA, ” DNex said, adding that the HoA will expire on Oct 31 unless extended.
The price of the acquisition has yet to be determined.
DNex said the proposal will enable the company to benefit from Ping’s future earnings in view of its potential to grow organically with its balanced portfolio of production, development and exploration assets. Ping is estimated to have proven and probable oil reserves of 24.8 million barrels equivalent.
Ping is an independent upstream O&G company, focusing on shallow water offshore production and development opportunities in South-East Asia and the North Sea.
In a separate filing, DNex said it posted RM24.08mil losses in the second quarter ended June 31 from RM12.35mil profit a year earlier due to one-off non-cash impairment loss totalling RM31.2mil.
Its revenue for the quarter fell 14% to RM62.04mil from RM72.20mil previously.
DNex said the impact by the coronavirus pandemic to the group is manageable as most of its projects were ongoing as usual.
“Our services continue to operate as usual during the MCO as part of essential services albeit with extra precautions for workers and travel.