Rockhopper Strikes Deal with $22m for Beach Energy Assets in Egypt

Rockhopper Exploration plc, the oil and gas exploration and production company with interests in the North Falkland Basin and the Greater Mediterranean and North Africa region, is pleased to announce the acquisition of a portfolio of non-operated production and exploration interests in Egypt from Beach Energy Limited for a headline consideration of US$22.0 million.

Abu Sennan concession
The Abu Sennan concession is located in the Abu Gharadig basin in the Western Desert. The concession was signed in June 2007 with first commercial production achieved during 2012 and cumulative oil production to date of approximately 1.9 million barrels. The concession remains underexplored with significant exploration and appraisal upside providing opportunities for near-term production additions. The concession partners are Kuwait Energy (50% and operator) and Dover Investments (28%).

El Qa'a Plain concession
The El Qa'a Plain concession is located on the eastern shore of the Gulf of Suez and contains a number of oil leads identified on existing 2D seismic data. The concession was signed in January 2014 and the forward plan is to acquire 450 sq km of 3D seismic in 2015 followed by the drilling of one or more exploration wells in 2016. The concession partners are Dana Petroleum (37.5% and operator) and Petroceltic (37.5%).

Financial information
The headline consideration for the Acquisition is US$22.0 million payable to Beach Energy through a combination of cash and the issue of the Rockhopper Consideration Shares. The cash element will be funded from the Company's existing cash resources. The precise number of Rockhopper Consideration Shares issued will be based on the volume weighted average price of Rockhopper shares during the 30 days prior to completion, subject to a maximum of 14.8 million new Rockhopper shares (adjustable for new shares issued prior to completion), representing up to 5% of the Company's issued share capital.

The actual sum payable at completion will be adjusted to take into account net cash flow attributable to the Interests from the effective date of 1 July 2015.

Unaudited revenue, EBITDA and profit after tax of $8.1 million, $6.3 million and $0.3 million respectively are attributable to the Interests in the 12 month period to 30 June 2015.

The Acquisition is expected to complete in late 2015 / early 2016 and is subject to the satisfaction of certain conditions precedent including completion of limited confirmatory due diligence, divestment by Beach Egypt of certain non-core assets, standard joint venture consents including pre-emption and Egyptian regulatory approvals.

Sam Moody, CEO, commented:
"This transaction represents another significant milestone as we continue to build Rockhopper into a full cycle, exploration led, E&P company focused on our two core areas of the North Falkland Basin and the Greater Mediterranean and North Africa region.

"We expect this portfolio to be net cash flow positive immediately and upon completion of the transaction expect operating cash flows from Egypt and our existing Italian assets to cover Group overheads going forward.

"Through the acquisition we have added 2P plus 2C reserves and resources at a net acquisition price of less than $4.50 per boe (after financial adjustments) whilst preserving our balance sheet and limiting dilution to shareholders to less than 5%."

For more information about related Opportunities and Key Players visit Egypt Oil and Gas Projects