KUALA LUMPUR: Hibiscus Petroleum Bhd expects its daily oil and condensate production to double in 2022 with the RM877mil purchase of five production sharing contracts (PSCs) from Repsol.
The company is targeting to complete the transaction this year.
"However, given that the effective date of the Proposed Acquisition is Jan 1, 2021, all economic benefits and risks from that date will accrue to Hibiscus Petroleum," it said in a statement today.
Under the deal, Hibiscus will acquire Repsol Exploración SA's entire equity interest in Fortuna International Petroleum Corp for US$212.5mil (RM877mil).
Fortuna owns stakes in four PSCs in Malaysia and one PSC in Vietnam.
“We are pleased to announce that after an international, competitive bidding process, we have been selected by Repsol to acquire their Malaysian and Block 46 Vietnam assets," Managing Director Dr Kenneth Pereira said.
"Once completed, this acquisition will be transformational for us and bodes well for the business trajectory of Hibiscus Petroleum into its next phase of growth," he added.
The acquisition will boost Hibiscus' 2P net entitlement daily production of oil and condensate from 9,000 barrels per day to 18,500 barrels per day in 2022.
Daily gas production from 2 MMscf per day to 49 MMscf per day in 2022.
Meanwhile, 2P oil and condensate reserves will be increased by by 1.5 times from 46 MMbbl to 67 MMbbl as at Jan 1, 2021, while 2P gas reserves would jump from from 9 Bscf to 93 Bscf.
"The 2P oil, condensate and gas reserves are valued at an estimated US$285mil (RM1.176bil)," Hibiscus said.
It said the total net undiscounted cash flows expected to be generated over the next 5 years from 2021 to 2025 are approximately US$255mil (RM1.05bil) (adjusted for potential third- party liabilities, while the estimated earnings before interest, tax and depreciation (Ebitda) contribution to the Group for 2022 is US$135mil (RM557mil).