Soco farewells Yemen in $465m sale

London-listed Soco International is selling its interests in the East Shabwa development area in Yemen to China’s Sinochem Petroleum for $465 million.

Soco will sell its subsidiary SOCO Yemen, the company that holds the international explorer and producer’s interests in Yemen, to the state-owned Chinese player.

The company said in a press release that Soco Yemen holds an indirect share of 16.785% in East Shabwa of Yemen through its 58.75% equity interest in Comeco Petroleum. Comeco has a 28.57% stake in East Shabwa in Block 10.

In December 2006, it was estimated that Soco’s interests in Yemen has net proven reserves of 18.7 million barrels and net proven and probable reserves of 29.6 million barrels of oil.

East Shabwa production averaged 40,400 barrels of oil per day in 2006 and Soco’s working interest share was 6766 bpd. During the first half last year’s production, SOCO’s net figure hit 6341 bpd.

In 2006, Soco Yemen made $76 million in revenue and profit before taxation of $55 million.

“The disposal will enable Soco to generate greater long-term value by re-investing the proceeds in the development of its core assets, particularly in Vietnam,” said Soco boss, Ed Story said.

Sinochem’s vice president, Han Gensheng said that the transaction diversifies its exploration and production portfolio with immediate production and increases its footprint in the Middle East, an area of focus for Sinochem.

(Upstream Online)


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