Genel Energy, the London-listed independent headed by Tony Hayward, is spending a further $240 million to further increase its interest in the Bina Bawi exploration bloc in Iraqi Kurdistan.
Genel announced today that it is paying $240 million in cash to Hawler Energy, a US minnow, for its 21% in the block. After the purchase, Genel will have a 44% stake in the block, following the company’s acquisition of Petoil subsidiary A&T Energy last week for $175 million.
OMV, the operator, will hold a 36% working interest and the KRG will retain 20%.
“This acquisition gives us a material interest in a third major oil and gas development (alongside Taq Taq and Tawke) and reinforces Genel’s leading position in the Kurdistan oil and gas province,” Hayward, commenting on the deal, said. “It is consistent with our strategy of continuing to build our Kurdistan business through selective acquisitions and our ongoing exploration drilling programme.”
After the above deals Genel will still have a large cash pile of around $1.5 billion.
The Bina Bawi exploration block is in the centre of the Kurdistan Region of Iraq and covers an area of 240 square km. It is 50 km to the east of Erbil and is the adjacent block to Genel Energy’s producing oil field Taq Taq. To date, 2 of the 3 exploration wells drilled on the block have encountered significant hydrocarbons.
The most recent well, Bina Bawi-3, encountered a gross hydrocarbon column of more than 800 metres in the Jurassic zone and two Jurassic reservoir intervals tested separately achieved an aggregate flow rate of more than 4,000 barrels a day of light, 44 to 47-degree API oil.
