OMV has invested more than half a billion dollars in the Malaysian joint venture DiePresse.com

The Austrian oil and gas company will pay $ 540 million to buy a stake in the Malaysian oil and gas company SEB Upstream (SUP), which could reach $ 85 million under certain conditions. This was announced by OMV on Friday after the conclusion of agreements for the creation of the SUP joint venture with the Malaysian Sapura Energy Group.

By mid-September, OMV had announced that such an agreement was being negotiated – the signing took place on Friday. OMV E & P, a subsidiary of OMV, acquires 50% of the capital of the new joint venture SUP. The purchase is based on an enterprise value of up to $ 1.6 billion, consisting of equity up to $ 1.250 billion and financial debt of $ 350 million.

Any additional payments in excess of $ 540 million largely depend on the volume of resources in block 30 (Mexico) at the time of the final investment decision, the document says. Both parties agreed to refinance the group's $ 350 million debt.

Growing market in Malaysia

Oil and gas demand in Malaysia is expected to increase by 20% by 2030 – and OMV seizes this opportunity to establish itself in a growing market, said OMV General Manager Rainer. Seele, in a press release. The cooperation will help establish the upstream strategy for Australasia as a new central region of OMV. Sapura Upstream must be fully consolidated in the OMV financial statements.

Sapura Upstream is expected to produce about 260 million barrels of oil equivalent over the life of the deposits, as well as strong growth prospects, according to OMV. Production and development badets are located off Malaysia. Commercial production of Sapura Upstream fields in Peninsular Malaysia was about 4.1 million boe in 2017.

Sapura Upstream holds interests in two E & P gas blocks off Sarawak (Malaysian State located on the northwest coast of Borneo Island); it is a well developed area with existing infrastructure. In SK408 fields off the coast of Malaysia, significant results were recorded from 2014 to 2018, with production expected to start in 2020 and increase significantly in 2023.

Total production based on the commercial share is expected to reach about 21 million boe per year, or about 60,000 boe per day. In addition to its Malaysian oil and gas badets, Sapura Upstream holds interests in exploration blocks in New Zealand, Australia and Mexico.

(APA)