Uchenna Izundu
International Editor
LONDON, Mar. 7 -- Afren PLC plans to buy Devon Energy Corp.'s Ivory Coast assets for $205 million.
The transaction, expected to close in the second quarter, remains subject to Ivory Coast government approval.
Terms call for Afren to become operator of producing offshore Block CI-11, with a 47.96% working interest, and will gain a 65% interest in (as yet undeveloped) Block CI-01, which lies in 1,900 m of water in the eastern Ivory Coast.
Afren also will gain rights to acquire an additional 15% interest in Block CI-01 and acquire full interest in the onshore Lion gas plant.
Both CI-11 and CI-01 blocks hold proved and probable reserves of 28 million boe as of June 30, 2007. Devon reported net production of 3,000 boe/d.
Afren plans to increase production from Block CI-11 through a rig-based workover program, low-risk wireline, and development of additional reservoir intervals.
By 2010, the company wants to produce on an entitlement basis more than 6,000 boe/d from upstream assets and LGP.
New gas supplies from Kudu and Eland fields on Block CI-01 could feed the 75 MMcfd Lion gas plant between 2010 and 2012. Ibex oil field on the same block also could be developed with associated gas going to the plant. The Lion plant produces butane and gasoline, which are sold on domestic and world markets respectively.
Afren will work with Cherokee Allied Oil & Gas Corp. and Ivory Coast state oil company Petroci to develop a fully integrated gas project and build the skills of the local workforce.
Devon said it was selling the acreage because it was no longer a core interest.
Contact Uchenna Izundu at [email protected].