Heritage Oil Limited, an independent upstream exploration and production company, announces that it has entered into a non-binding Memorandum of Understanding (“MoU”) with Genel Enerji A.S. The MoU is subject to various conditions and execution of binding documentation to acquire Genel Energy International Limited (“Genel”), a private independent oil and gas exploration and production company, which holds licences in the Kurdistan Region of Iraq (“Kurdistan”). The proposed acquisition would be paid for wholly in new shares of Heritage and would result in Genel shareholders owning approximately 50% of the enlarged ordinary share capital of Heritage. It is anticipated that following the Proposed Acquisition, the Company, as enlarged by the acquisition of Genel will be re-named HeritaGE Oil plc.
Heritage’s management believe that the Proposed Acquisition will offer considerable shareholder value as it will create a prominent Main Market London listed production company which should have the financial capacity to bring into production its enlarged development and exploration portfolio, create the infrastructure for the development of the Taq Taq and Miran assets in Kurdistan, while also generating significant cash flow following the commencement of oil exports on 1 June 2009.