Hibiscus expects threefold increase in o&g output due to Repsol deal

Malaysia’s oil and gas company Hibiscus Petroleum has completed the acquisition of Repsol’s E&P assets in Malaysia and Vietnam in what was described as a transformational deal for the Malaysian company.

Following the acquisition agreement from June 2021, Hibiscus’ indirect wholly-owned subsidiary, Peninsula Hibiscus, has completed the acquisition of the entire equity interest in Fortuna International Petroleum Corporation from Repsol on 24 January 2022.

Out of the purchase price of $212.50 million, the net amount paid at completion is $123.65 million after taking into account various adjustments including the deposit paid of $15 million. The completion comes shortly after all conditions were fulfilled as announced on 20 January 2022.

The asset portfolio comprises interests and operatorship in five production sharing contracts (PSCs) in Malaysia and Vietnam, including a 35 per cent interest in PM3 CAA PSC, 60 per cent in 2012 Kinabalu Oil PSC, 60 per cent in PM305 PSC, 60 per cent in PM314 PSC, and 70 per cent in Block 46 CN in Vietnam (a tie-back asset to the PM3 CAA production facilities).

As a result of the acquisition, Hibiscus’ average daily oil and gas production is projected to increase almost threefold.

Being the operator of the newly acquired assets positions Hibiscus to build on its track record in its other producing assets in the United Kingdom and Malaysia.

Commenting on the completion, Managing Director, Dr Kenneth Gerard Pereira, said, “The completion of this acquisition brings to a close the process which began when we first bid for these assets and opens a new chapter in the group’s next phase of growth. We welcome onboard the Repsol team into the Hibiscus family and look forward to working together on further enhancing value from these assets in 2022 and beyond.

“Almost 50 per cent of the production comprises gas. The addition of gas production is expected to present a better balance to our group’s asset portfolio in terms of price stability, markets and operations. Such diversification represents a key aspect of our energy transition strategy as natural gas has been regarded as an important bridging fuel as the world transits to a lower-carbon energy mix.”