Sub-Saharan oil and gas company Delonex Energy has signed an agreement with United Hydrocarbon International (UHI) to acquire its subsidiary, United Hydrocarbon Chad (UHC), for $35m.
UHC holds UHI’s Production Sharing Contract (PSC) in the Republic of Chad, Central Africa.
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Pursuant to the agreement, Delonex will engage in a comprehensive exploration programme by incurring a minimum expenditure of $65m in the PSC in Chad.
The initiative includes 2D and 3D seismic programmes and three exploration wells.
Under the deal, UHI will continue to hold an economic interest in the Chad PSC and benefit from future commercial success in the form of deferred payments at agreed milestones in both the Doba basin and the Lake Chad Block H.
With no major operations since the mid-1970s in Block H, this transaction is expected to accelerate exploration and development of Chad’s hydrocarbon resources across the PSC.
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By GlobalDataUHI president and CEO Gabriel Ollivier said: “The transaction is transformational for Chad in that our agreement requires an active exploration programme to be initiated immediately upon approval.
“With industry-leading and proven project execution skills, access to advanced technologies and financial strength, Delonex is the right partner for United and for the Government of Chad as we seek to increase oil production, boost export capabilities and create value for Chad and for United’s shareholders.”
The completion of the transaction is subject to certain conditions, including approval from the Government of Chad and UHI shareholder consent.
