Carnarvon Petroleum cashes up on Thai asset sale

THE ROADHOUSE BOWSER: Carnarvon Petroleum (ASX: CVN) has entered into a Sale and Purchase Agreement (SPA) to divest its remaining 20 per cent interest in the Thailand oil production concessions L44/43, L33/43 and SW1A.

The company has agreed to sell its remaining 20 per cent interest in its Thai assets to the Berlanga Group for a total cash consideration of US$58.2 million (A$68.5 million).

The SPA was entered into with Berlanga Thailand Limited, a member of the Berlanga Group, and a deposit of US$2 million was received by Carnarvon upon signing the SPA.

“This is a positive commercial outcome for the company,” Carnarvon Petroleum managing director and chief executive officer Adrian Cook said in the company’s announcement to the Australian Securities Exchange.

“Carnarvon’s already robust balance sheet will be strengthened with cash forecast to exceed A$100 million post-completion.

“On completion of this transaction we will have realised US$91 million in the past year from the sale of our Thailand interests with up to a further US$32 million to be received in the future.

“This has proven to be a very profitable investment and a powerful demonstration of our willingness to think and act differently.

“With the sale, we are now entirely focused on maximising value in the North West Shelf of Western Australia.

“Upon completion of the sale we will have secured important funding for our future activities without diluting our shareholders’ interests or raising debt.

“We are now well-funded and focused to follow up on our success at the Phoenix South-1 well.”

The SPA is subject to satisfaction of standard terms and conditions, including receiving joint venture partner consents, executing completion documents and payment of the consideration.

Completion of the deal is currently scheduled to occur on or before 16 February 2015.