Carnarvon reaches agreement to divest the balance of its Thailand assets
Carnarvon Petroleum Limited (ASX: CVN) (“Carnarvon”) is pleased to advise that the Company has entered into a Sale and Purchase Agreement (SPA) to divest its remaining 20% interest in the Thailand oil production concessions L44/43, L33/43 and SW1A (Thai assets).
Carnarvon has agreed to sell its remaining 20% interest in its Thai assets to the Berlanga Group for a total cash consideration of US$58.2
1 million (A$68.5 million2). The above amounts include working capital of approximately US$8.2 million, subject to final completion adjustments.
The SPA was entered into with Berlanga Thailand Limited, a member of the Berlanga Group, and a deposit of US$2.0 million (A$2.3 million2) was received by Carnarvon upon signing the SPA.
The SPA is subject to satisfaction of standard terms and conditions, including receiving joint venture partner consents, executing completion documents and payment of the consideration. Completion is currently scheduled to occur on or before 16 February 2015.
Carnarvon retains its US$32 million receivable in the Thai assets, agreed to as part of the Loyz transaction announced in March 2014.
Managing Director and Chief Executive Officer, Mr Adrian Cook said,
“This is a positive commercial outcome for the Company. Carnarvon’s already robust balance sheet will be strengthened with cash forecast to exceed A$100 million post-completion. On completion of this transaction we will have realised US$91 million in the past year from the sale of our Thailand interests with up to a further US$32m to be received in the future. This has proven to be a very profitable investment and a powerful demonstration
of our willingness to think and act differently. With the sale, we are now entirely focused on maximising value in the North West Shelf of Western
Australia. Upon completion of the sale we will have secured important funding for our future activities without diluting our shareholders’ interests or raising debt. We are now well funded and focused to follow up on our success at the Phoenix South-1 well.”
Carnarvon Petroleum was advised by Miro Advisors and King & Wood Mallesons. Berlanga Thailand Limited was advised by Silverhorn Investment Advisors and K&L Gates.