IPR Lake Qarun Petroleum Co., a wholly owned subsidiary of IPR Energy AG, entered into conditional agreements to acquire 55% working interest and operatorship of the El Fayum and North Beni Suef concessions onshore Egypt from Pharos Energy PLC.
Consideration implies a gross (100%) value of up to $115 million for the assets and consists of $5 million cash at completion of the transaction, funding of the Pharos Group's retained interest share of the cost of future activities on the assets for $38.425 million net (subject to working capital and interim period adjustments from the economic effective date of 1 July 2020), and contingent consideration of up to $20 million dependent on Brent oil prices in each calendar year from 2022 to 2025.
First-half 2021 net production from the fields is 3,718 b/d of oil. Full-year 2021 net production guidance was revised to 3,200-3,500 b/d of oil from 4,000–4,400 b/d of oil due to operational delays and the drive mechanism being primary depletion only (steep declines) until the main waterflood secondary recovery program is operational, Pharos said in a Sept. 15 investor presentation.
Plans in place to accelerate production enhancement in second-half 2021 include a second workover rig operating since end August, and recommencement of development drilling operations via a 3-well interim program approved by the board in mid-August. One drilling rig is being contracted and the first well is expected to spud in October, according to the presentation.
IPR has been present in Egypt for 40 years, currently with eight concessions and operating five (onshore and offshore) and active in all four key producing regions (Western Desert, Nile Delta, Gulf of Suez, and Eastern Desert).
Deal completion is expected in first-quarter 2022.