ENOC upstream energy producer, Dragon Oil, has confirmed that it will bid around $800mn for oil firm Petroceltic. The move is intended to boost Dragon Oil’s presence in Algeria, where it was awarded new oil and gas licences last week, according to Reuters.
Petroceltic said on Monday that Dragon Oil intended to offer 230 pence a share, a 35 percent premium to the Irish company’s recent average stock price.
At 0745 GMT, Petroceltic shares were up 20.6 percent to 215.25 pence, while Dragon Oil’s were down 0.3 percent to 572 pence.
The proposal is not a firm offer and remains to be approved by Dragon Oil’s biggest shareholder.
Petroceltic said it would be willing to accept the offer once Dragon Oil’s majority shareholder approved it, and if certain unspecified conditions were met.
One of Petroceltic’s main assets is the Ain Tsila gas field in Algeria, a market where Dragon Oil recently obtained new drilling licences in a consortium with Italy’s Enel.
Dragon Oil’s main production assets are in Turkmenistan.
“Petroceltic would bring Dragon Oil additional reserves in its focus areas,” a Dragon Oil spokesman said, adding a deal would also diversify its portfolio and give it access to assets across the whole exploration and production cycle.
