United Oil and Gas Company (UNICO) declared its proposal to acquire Rockhopper Exploration Egypt for $16 million, according to a company’s statement.

The acquisition will deliver over 1,100 barrels of oil equivalent per day (boe/d) of net low-cost production with 2.64 million boe net 2P Reserves to UNICO.

Rockhopper has 22% interest in a set of operational oil fields with 17 producing wells. Current gross production at the Abu Sennan concession that contains a large exploration area with a significant prospect potential stands at over 5,100 boe/d.

The British BP Company will provide $8 million to fund the acquisition after it entered an offtake agreement for UNICO’s future oil and gas production, whereby BP will purchase all, or a substantial amount, of the output produced from the project.

While BP is providing a significant portion of financing for the deal, UNICO will place new ordinary shares worth up to $5 million to Rockhopper.

Brian Larkin, UNICO’s CEO said that this is transformational deal for UNICO, as not only will it deliver their first production, positive cashflow and significant reserves, it also offers very promising infill and exploration upside and that Rockhopper Egypt was by far and away the most exciting opportunity and the best strategic fit for their business.