Sequa Petroleum N.V. has announced an update to its planned acquisition of a 15% interest in Gina Krog. This acquisition was announced on 19 October 2015. Since then, the Gina Krog acquisition has received all necessary government approvals, and the Company's 100% subsidiary Tellus Petroleum A.S. (Tellus) has been approved as a new Norwegian Continental Shelf's (NCS) licence holder.
Gina Krog is one of the NCS largest current developments and is operated by Statoil. It is currently within budget and on schedule for first production in 2Q17.
The 2P reserves are estimated at approximately 260 million boe, of which 39 million boe are net to the Company. OPEX and CAPEX costs are both estimated at approximately US$15/boe. These estimates are calculated over the field life, from the effective date of 1 January (being the effective date of the Company's acquisition), representing a low marginal cost.
The Gina Krog field has further resource potential beyond its 2P reserves. There is potential, through development optimisation, for prolongation of the first production plateau, as well as from several appraisal segments which were not included in the initial PDO
The transaction terms for the acquisition of Gina Krog are at an attractive discount to comparable transactions in Norway. These terms result in all-in costs until first production of approximately US$9/boe of 2P reserves. The seller will retain the tax balances related to the Gina Krog investments prior to the effective date.
Edited from press release by Angharad Lock
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