Sonangol to acquire interest in block

Angola’s Sonangol exercised its right of first refusal with its wholly owned subsidiary, Sociedad Pesquisa e Producao SARL, agreeing to buy 20% undivided working interest in Angola Block 32 from Marathon Oil Corp.

By OGJ editors
HOUSTON, Dec. 16
-- Angola’s Sonangol exercised its right of first refusal with its wholly owned subsidiary, Sociedad Pesquisa e Producao SARL, agreeing to buy 20% undivided working interest in Angola Block 32 from Marathon Oil Corp.

The deal is expected to close in January, with Marathon retaining 10% working interest in the block. Officials said the terms of the agreement are the same as the previously announced transaction.

In July, subsidiary Marathon International Petroleum Angola Block 32 Ltd. signed a $1.3 billion definitive agreement by which CNOOC International Ltd. and Sinopec International Petroleum Exploration & Production Corp. would acquire the Marathon unit’s undivided 20% participating interest in the production-sharing contract and joint-operating agreement in Block 32 off Angola. The transaction total excluded any purchase price adjustments at closing, with an effective date of Jan. 1, 2009. Marathon would retain a 10% working interest in the block, but other Block 32 partners had rights of first refusal.

Sonangol served as concessionaire of Block 32. Block operator Total E&P Angola (Block 32) Ltd. held 30% interest. Other partners were Sonangol P&P 20%, Esso E&P Angola (Block 32) 15%, and Petrogal 5%.

At that time, David E. Roberts Jr., Marathon executive vice-president of upstream operations, said, “With the divestiture of a portion of our Angola interest, we are able to bring better balance to our overall portfolio by capturing the sizable amount of value we have created and redeploying capital into other growth regions for the company. At the same time, maintaining a 10% interest in both Blocks 31 and 32 provides Marathon with exposure to this important resource base.”

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