Petsec Energy Ltd., Sydney, has made its maiden entry into the Middle East, signing an agreement with fellow Sydney firm AWE Ltd. to acquire a 21.25% participating interest in Block 7 of the Al Barqua permit in Yemen.
The onshore permit covers an area of 5,000 sq km and is operated by Sydney-Papua New Guinea company Oil Search Ltd.
It contains the Al Meashar oil discovery as well as a number of leads and prospects with significant potential already defined by both 2D and 3D seismic data.
Petsec will pay $1 million for the interest. It also will replace AWE’s existing letter of credit with the Arab Bank and there will be working capital adjustments at completion.
The deal still requires joint venture approval as well as from state-owned Yemen Oil & Gas Co.
Petsec says the agreement marks the culmination of a number of years of strategic planning and is the start of an expansion of the company’s portfolio of assets into the Middle East. The company plans to secure high value assets in the region with particular emphasis on oil.