United Oil & Gas today announced that, further to the signing of non-binding Heads of Terms as previously announced on the 28 July 2021, it has now entered into a binding sale and purchase agreement ("SPA") with Quattro Energy to sell UK Central North Sea Licences P2480 and P2519 for a headline consideration of up to £3.2 million (c. US $4.4 million).
The Transaction will result in an initial payment of £2 million to United (c. US $2.8 million) in cash at completion. Subject to a Field Development Plan being approved for block 15/18e, an additional uplift amount of £1.2 million will be paid to United.
United was awarded Licence P2480, in the UK Oil and Gas Authority ("OGA") 31st Licencing Round in August 2019 and Licence P2519 in the 32nd Licencing Round, in December 2020. United holds a 100% equity interest in each. Licence P2519 includes the Maria Discovery in block 15/18e.
Location of the P2480 Licence and surrounding fields, discoveries and infrastructure
Quattro Energy is a new UK company incorporated in April 2021 by an experienced North Sea focused management team. The acquisition of United's Central North Sea interests is a first step towards Quattro's objective to build a portfolio of oil & gas appraisal, development, and producing assets.
The completion of the SPA is conditional on OGA approval. It is anticipated that completion of the SPA will be in Q4 2021. The Long stop date for satisfaction is 6 December 2021.
The divestment of these Licences, following a strategic review of the Company's portfolio, will see United exit activities in the North Sea region.
United's Chief Executive Officer, Brian Larkin commented:
"The sale of United's Licenses in the North Sea demonstrates our commitment to portfolio optimisation, which forms a key part of the Group's strategy. The transaction proceeds will provide financial flexibility for the Company to grow its low-cost production business in Egypt and the Greater Mediterranean area, complemented with selected high impact exploration opportunities in the Caribbean and Latin America."
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