By OGJ editors
HOUSTON, Feb. 13 -- IPR Red Sea Ltd. acquired 100% of the stock of Devon Energy International's Egyptian assets in the Gulf of Suez for an undisclosed sum.
The seller is a unit of Devon Energy Corp., Oklahoma City.
The purchase included the interests of Devon Energy Red Sea Inc. and Devon Energy Suez Inc., which owned interests in the North July and South West Gebel El-Zeit (SWGEZ) concessions, respectively.
IPR Red Sea is a subsidiary of IPR Transoil Corp. and a member of the privately held Improved Petroleum Recovery Group of Cos., Irving, Tex. The acquisition is IPR's first offshore foothold in Egypt, where it operates producing and exploration properties in the Western Desert.
Fanar Petroleum Co., the IPR-Egyptian General Petroleum Corp. joint venture, produces 1,500 b/d of 37° gravity crude and 700 Mcfd of gas from the North July-1 well. A second well is to spud in mid-March from the three-slot platform in 169 ft of water in the Gulf of Suez. BP PLC purchases the oil.
Ocean Energy Inc., Houston, operates SWGEZ, in which IPR holds 43.75% working interest. A discovery on the concession, in 86 ft of water, flowed on test at a rate of 6,700 b/d of oil and 2.4 MMcfd of gas, and Ocean has submitted a development plan to EGPC.
Gross reserves in the two concessions are estimated at 10.6 million bbl proved and 129.6 million bbl proved and probable. Exploration prospects and leads have unrisked potential of 77-289 million bbl, says IPR.
IPR also operates Alamein, Yidma, and Tarfa fields in the Western Desert and operates and holds interests in the El-Hamra terminal near the Mediterranean Sea and a 40 km, 12-in. pipeline, all acquired from Phillips Petroleum Co. in 1993. IPR also holds operatorship and interest in the North Ras Qattara, North Bahariya, and El-Diyur exploration concessions in the Western Desert.
Devon's financials
Devon recognized a $10 million pretax loss ($11 million after tax) in fourth quarter 2002 on the Egyptian transaction, including the effects of operations during the quarter.
During 2002, Devon discontinued its Indonesian, Argentine, and Egyptian operations. The company recognized a $31 million pretax gain ($31 million after tax) during 2002 on these discontinued operations.
The company also recognized $23 million of pretax income ($14 million after tax) from operations prior to discontinuing these operations.
These moves were part of Devon's efforts to focus its operations on North America.
