MENA Hydrocarbons Inc. is pleased to announce that it has received co-venturer approval for the acquisition of a 55 percent participating interest in the West Mediterranean, Block 1, Segment A block located 60 km off the Mediterranean coast of Egypt. It is proposed that the acquisition be completed by an indirect wholly-owned subsidiary of MENA. An agreement with the current operator, Hess Egypt West Mediterranean Limited, has been signed as of May 31, 2011. The acquisition was subject to rights of pre-emption in favour of the existing co-venturers. The co-venturers decided not to pre-empt and have also given their consent to the transaction. MENA intends to seek appointment as operator following the outstanding approval of the Egyptian General Petroleum Corporation and the Egyptian Government and the completion of other customary closing conditions.
Five gas or gas-condensate discoveries have been made on the block. The block is under standard commercial terms for Egyptian concessions. The offshore development lease governing the block is valid for 20 years from the date of first gas deliveries, with an optional five-year extension. The purchase price is US$7.5 million (subject to adjustments) payable in cash.
Graham Lyon, President & Chief Executive Officer of MENA said: “We are another step further in implementing MENA’s strategy of building a portfolio of development, production and high impact exploration assets and are pleased to have passed this important step in project capture for MENA in such a short time. We will work with our co-venturers and the authorities to proceed in this development license to a profitable venture and address the significant exploration potential.”