ZaZa Energy sells its French assets to Vermilion Energy

Houston-based ZaZa Energy Corporation [NASDAQ: ZAZA] said Dec. 27 that it has completed the sale of its French assets, comprising 100% of the shares of ZaZa Energy France SAS (ZEF), to Vermilion REP SAS, a wholly-owned subsidiary of Vermilion Energy Inc., for a gross purchase price of US$85.8 million.

Taking into consideration customary closing adjustments and contractually obligated asset integrity and G&A contributions, the net purchase price paid to ZaZa was approximately US$76 million. Resulting acquisition metrics reflect a cash valuation of ~US$90,000 per bbl/d and ~US$13.64 per boe of proved reserves.

ZaZa applied half of the net proceeds from the disposition to pay down a substantial part of its remaining senior secured notes. As part of the Paris Basin Purchase and Sale Agreement signed with Hess in July 2012, $15.0 million of the proceeds will be held in escrow until title to all Paris Basin exploration permits have been successfully transferred to Hess. The title transfer process is underway and is expected to be completed in 2013. The remaining proceeds will be used to fund ZaZa’s development program.

Commenting on the announcement, Todd A. Brooks, CEO of ZaZa Energy Corporation said, “With a portion of the cash received from this disposition, we have now paid down over two-thirds of our senior secured debt in less than a year. In addition to dramatically reducing the company’s leverage, ZaZa is now better capitalized to continue developing its core Eaglebine and Eagle Ford resource plays. This divestiture is consistent with our stated strategy and provides ZaZa with additional working capital and greater financial flexibility moving forward. We look forward to a successful 2013, the first quarter of which will most certainly be dynamic, as we expect to see the initial results from our aggressive development plan.”

Headquartered in Houston, Texas, with offices in Corpus Christi, Texas and Paris, France, ZaZa Energy Corporation is a publicly-traded exploration and production company with primary assets in the Eagle Ford and Eaglebine resource plays in Texas.

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

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 ...

Reduce Engineering Project Complexity

Engineering document management presents unique and complex challenges. A solution based in Enter...

Revolutionizing Asset Management in the Electric Power Industry

With the arrival of the Industrial Internet of Things, data is growing and becoming more accessib...