Oilfield services provider Petrofac has agreed to sell a 49% stake in its Mexican operations to France-based oil and gas company Perenco (Oil & Gas) International for a price of $400m.
The deal covers sale of 49% of Petrofac Netherlands, which owns the Santuario Production Sharing Contract, the Magallanes Production Enhancement Contract and the Arenque Production Enhancement Contract.
For Petrofac, the transaction is part of its strategy to reduce capital intensity.
As per the terms of the deal, the oilfield services provider will be initially paid $200m in cash, followed by $30m which will paid upon signing and $170m upon its closing.
The total consideration is made up of a fixed amount and contingent consideration, which will be subject to various future milestones, including future field development and migration terms of the Magallanes and Arenque Production Enhancement Contracts.
Petrofac Group CEO Ayman Asfari said: â€śWe are delighted to welcome an experienced partner in Perenco to our Mexican operations. They bring strong technical capability that will complement our existing brownfield operations experience to strengthen our offering.
â€śWe look forward to working with them and the other stakeholders to further develop our mature field interests in Mexico.â€ť
The transaction is anticipated to be closed in the fourth quarter of 2018 should it secure approval from the Federal Competition Commission of Mexico (COFECE).
Perenco CEO Benoit de la Fouchardiere said: â€śFollowing a previous successful collaboration with Petrofac we have been delighted to explore further opportunities to work together. Mexico is a land of opportunities, a new play, a new country and an exciting new challenge for Perenco.
â€śPartnering with Petrofac in Mexico will give us a fantastic opportunity to reach our goals in a timely manner and, by our results, demonstrate to the State company Pemex that we can also be a partner of choice for the future.â€ť
In late June, Petrofac had signed a deal to sell out its entire stake of 45% in the Chergui asset in Tunisia to Perenco for an undisclosed price. The sale is part of Petrofacâ€™s strategy to transition back to a capital light business model by offloading its non-core assets.