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UPDATE 1-Genel venture buys stakes in two Angolan oil licenses
April 3, 2014 / 11:36 AM / 4 years ago

UPDATE 1-Genel venture buys stakes in two Angolan oil licenses

(Combines stories from Oslo and London, adds details, background)

OSLO/LONDON, April 3 (Reuters) - London-listed oil company Genel Energy and a joint venture partner have agreed to buy 15 percent stakes in two exploratory licences offshore Angola for $281 million, its first acquisition in Angola.

WRG, a venture owned by Genel and White Rose Energy Ventures, will acquire a 15 percent stake in Block 38 in the Kwanza Basin from China Sonangol for $59 million, of which Genel will pay a net sum of $30 million, and a 15 percent interest in the adjacent Block 39 from Norway’s Statoil for $222 million.

Statoil operates both blocks and has interests in three other licences in the Kwanza Basin, where so-called pre-salt geological formations lie. Its exploration chief has said they hold the potential for discoveries amounting to billions of barrels of oil.

“This transaction provides a rare opportunity to enter into a low risk, multi-billion barrel resource play,” Genel Chief Executive Tony Hayward, former head of oil major BP, said in a statement.

For Genel, the Angola stakes will add to existing African assets including in Morocco, Ivory Cast, Somaliland and Ethiopia.

Drilling on Block 39 is expected to commence in the second quarter, followed by exploration on Block 38, Genel said.

Statoil said it had sold the stake to “share exploration risk”.

Angola already contributes 28 percent of Statoil’s oil and gas output outside Norway.

Statoil will retain a 40 percent stake in Block 39. The other partners are France’s Total with 15 percent and Angolan state oil firm Sonangol with 30 percent.

The Norwegian company will participate in the drilling of eight wells in the next two to three years in total, it added.

Genel said it planned to pay for the transactions, which are subject to government and partner approvals, through existing cash balances. (Reporting by Gwladys Fouche and Karolin Schaps; editing by Jane Baird)

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