Rex ending the year with corporate restructuring to pursue growth opportunities

Masirah Oil, an affiliate of Singapore’s oil exploration and production company Rex International Holding, has repurchased some shares from its wholly-owned subsidiary, Rex Oman.

The 102,000 shares were canceled on repurchase, thus reducing the number of Masirah’s issued shares from 202,000 to 100,000. The restructuring resulted in an effective disposal of 1.86% of the Rex Group’s interests in Masirah, which holds a 100% operating interest in Oman’s Block 50 and its producing Yumna Field.

According to Rex, the restructuring forms part of the group’s housekeeping efforts aiming to streamline its shareholding structures in various subsidiaries. The Singaporean player believes the simplified ownership structure in Masirah will give it more flexibility to develop business strategies for its subsidiary with existing and potential future partners.

As explained, the net asset value and book value of Masirah as of June 30, 2024, is said to be $56.85 million based on the latest unaudited accounts and the corresponding net asset value. The book value of the restructuring is approximately $1.06 million.

Additionally, the consideration for the restructuring takes into account the rationale for the restructuring and that it is for the settlement of intercompany payables of approximately $14.55 million. The excess consideration amount over the book value of the restructuring is said to equal roughly $13.49 million.

The restructuring took place immediately before a global settlement agreement was signed for the legal claim brought by Côte d’Ivoire’s Petroci Holding against Rex Oman in 2021. The claim was connected with the alleged conduct of Masirah’s affairs, which Petroci claimed led to a dilution of its interest in Masirah as a partner and minority shareholder. 

As a result of the restructuring, Rex Oman transferred 8,808 ordinary shares to Petroci to achieve its stake in Masirah on the closing of the settlement agreement. Consequently, Petroci’s shareholding in Masirah rose to 12.5% and Rex Oman’s reduced to 87.5%.

Block 50 is an approximately 17,000 square-kilometer offshore concession located in the Gulf of Masirah, east of Oman. It achieved its first oil in February 2020, while the approval of the field development plan for the Yumna Field and declaration of commerciality (DOC) were obtained in July 2020.

In June 2024, Masirah wrapped up a multi-well drilling program at the field, which started in late March. Northern Offshore’s Energy Emerger jack-up rig was used to get the job done, which included a new in-field well and the work-over of two existing production wells.