Pacific Rubiales acquires Colombian interests from Maurel et Prom

Pacific Rubiales to pay US$66 million upfront in addition to future carried obligations

Canadian-based Pacific Rubiales Energy Corp. has acquired 50% of the interests held by Maurel et Prom in the Sabanero, Muisca, SSJN-9, CPO-17 and COR- 15 blocks, which are all located on-shore in Colombia.

Ronald Pantin, chief executive officer (CEO) of the company, commented, "We are very pleased to join forces with Maurel et Prom. This acquisition adds significant resources and exploratory potential to our already robust resource base. Moreover, this acquisition fits synergistically with our other assets located in the same basins, paving the way to significant efficiencies in production and transport. With this acquisition we continue raising the bar as the premier explorer and operator in Colombia."

Upon completion of the transaction, Pacific Rubiales will partner with Maurel et Prom in respect of the following interests:
• 100% participation in the Sabanero Block located in the central region of Colombia in the Department of Meta. • 100% participation in the Muisca Block located in the central region of Colombia in the Departments of Boyacá and Cundinamarca.
• 50% participation in the SSJN-9 Block located in the northern region of Colombia in the Departments of Bolivar, Cesar and Magdalena. The remaining 50% interest is currently held by HOCOL.
• 50% participation in CPO-17 Block located in the central region of Colombia in the Department of Meta. The remaining 50% interest is currently held by HOCOL.
• 100% participation in the COR-15 Block located in the central region of Colombia in the Department of Boyacá.

This agreement is subject to legal and regulatory approvals of the ANH and certain contractual approvals with the partners in Colombia.

The general terms of the agreement with Maurel et Prom are as follows:
• Pacific Rubiales will pay to Maurel et Prom cash consideration to a maximum of US$66 million as a reimbursement for past exploration costs in the blocks, as at March 31, 2011.
• Pacific Rubiales will assume a full carried obligation on the exploration and delineation activities in the Sabanero Block with a reimbursement out of the free cash flow. The company will also secure the financing required by Maurel et Prom to execute its portion of the development activities in such block.
• Reimbursement will also be made by means of free cash flow derived from future hydrocarbon production. Pacific Rubiales offers to assume a full carried obligation of up to US$120 million in three years for exploration activities in the SSJN-9, CPO-17 and Muisca Blocks. This obligation will be subject to revisions pending the activity results and negotiations with the other applicable partners.
• Pacific Rubiales will assume a full carry obligation on exploration activities for Block COR-15, with reimbursement by means of free cash flow derived from future hydrocarbon production. The company will also secure the financing required by Maurel et Prom to execute its portion of the development activities in such block. Reimbursement will also be made by means of free cash flow derived from future hydrocarbon production. 

Source:  Pacific Rubiales Energy Corp.



Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now

Whitepapers

The Time is Right for Optimum Reliability: Capital-Intensive Industries and Asset Performance Management

Imagine a plant that is no longer at risk of a random shutdown. Imagine not worrying about losing...

Going Digital: The New Normal in Oil & Gas

In this whitepaper you will learn how Keystone Engineering, ONGC, and Saipem are using software t...

Maximizing Operational Excellence

In a recent survey conducted by PennEnergy Research, 70% of surveyed energy industry professional...

Leveraging the Power of Information in the Energy Industry

Information Governance is about more than compliance. It’s about using your information to drive ...