Update Sona Petroleum expects SC approval to buy Salamander O&G assets in 4Q

by **Cals** Tue 17 Jun 2014, 01:15

Update Sona Petroleum expects SC approval to buy Salamander O&G assets in 4Q

Business & Markets 2014

Written by Jeffrey Tan of theedgemalaysia.com

Monday, 16 June 2014 15:44

KUALA LUMPUR (June 16): Sona Petroleum Bhd, a special purpose acquisition company (SPAC),says it expects the Securities Commission Malaysia (SC) to grant approval in the fourth quarter this year for the acquisition of oil & gas (O&G) assets from UK-listed Salamander Energy Plc.

Earlier this month, Sona Petroleum announced it planned to buy a 40% stake in UK-listed Salamander Energy Plc's marine oil & gas (O&G) fields in Thailand for US$280 million (RM903.64 million) cash.

Today, Sona Petroleum’s Vice President of Business Development, Datuk Saw Choo Boon told reporters the firm would ink the sales and purchase agreement and other key transaction documents on June 26.

Following that, he said, the firm planned to submit its proposal and draft circular to the SC by the end of July.

“The SC could take two to three or four months [for approval]. We hope SC could approve it quicker,” he added after Sona Petroleum’s AGM.

“Our target is in early fourth quarter,” he said.

On concerns over management control as per SPAC guidelines by the SC, Saw assured that Sona Petroleum has joint control over strategic and financial decisions as the proposed acquisition will see the firm acquiring a 66.67% stake in the operator, Salamander Energy (Bualang) Ltd (SEBG).

SEBG owns 60% each in the O&G blocks, B8/38 and G4/50, which translates into an effective working interest of 40% for Sona Petroleum.

He added the firm has management control of the operations of the O&G blocks via provision of management services.

“With the 66.67% interest in SEBG, we will have management control over operations of the blocks,” said Saw.

“Certainly, we will also have joint control over strategic and financial decisions, which require a unanimous vote.”

Meanwhile, Sona Petroleum’s Managing Director Datuk Seri Hadian bin Hashim said the firm would not be acquiring more O&G assets this year or in the next one to two years.

“We have to make sure the assets we propose to acquire will produce [commercial oil],” he said.