By Gulgiz Dadashova
Greenfields Petroleum Corporation, engaged in development and production of proven oil and gas reserves mainly in Azerbaijan, has inked a deal to purchase a 66-percent stake in the Bahar Energy Limited Operating Company, a source in the country’s energy sector told Trend.
The agreement was signed with the bankrupt Baghlan Group and its liquidator. Following the deal, Greenfields will receive the rest 66.67 percent share in the Bahar Energy Ltd., and become the only shareholder.
Bahar Energy Ltd. is developing the oil and gas block, including Bahar and Gum Deniz deposits in the Azerbaijani sector of the Caspian Sea. The Bahar project comprises nearly 76,500 acres of producing oil field and a producing gas field 10 km offshore Azerbaijan in shallow waters (10 metres) of the Caspian Sea.
"Greenfields Petroleum Corporation will pay Baghlan Group’s contribution in the company’s capital and assume the obligations to pay off the loan, granted by Bahar Energy Ltd. for the development of fields,” the source said.
“The transaction amount includes the payment worth $6 million, as well as the repayment of obligations incurred by Baghlan Group towards Bahar Energy Ltd., the so-called default liabilities.”
The source refused to specify the total amount of the transaction, but noted that Greenfields Petroleum Corporation is assessing the default liabilities at around $57.6 million.
“Some $6 million will be placed on a special account as a deposit before completion of the deal in order to confirm the company's liabilities. The deal is expected to be completed within the next three month,” the source said.
To finance the agreement, the company agreed on a debt restructuring and once again extended the loan agreement on the allocation of funds for the development of the block “Bahar-Gum Deniz”.
“The new agreement provides for the allocation of additional $7 million for the deal on acquisition of a stake in Bahar Energy Limited and operational costs, as well as prolongation of the loan agreement until May 16, 2016,” the source said. “After restructuring of the loan is completed, Greenfields Petroleum Corporation intends to extend the loan agreement until December 31, 2017.”
Previously, SOCAR signed a production sharing agreement (PSA) with Bahar Energy Ltd. for exploration, rehabilitation, development and extraction at the Bahar-Gum Deniz block.
Bahar Energy Ltd., according to initial estimates, will invest $1 billion for implementation of works under the PSA. The PSA’s second part involves an exploration at the Bahar-2 structure ,that is drilling one exploration well in three years and another in the fourth year. Bahar field, located 40 km southeast of Baku, the capital of Azerbaijan, has been developed since 1969.
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