Ophir/Salamander agree proposed offer terms

November 21, 2014

Salamander Energy and Ophir Energy have agreed the proposed terms of a deal which would see Ophir takeover Salamander.

The two companies say that the move had “compelling strategic logic,” including a strong balance sheet, enhanced operating capability across the firm’s core operating geographies of Africa and South East Asia, and expertise across key technical and commercial functions.

Image: The Deepsea Metro I, which has been drilling offshore Tanzania for Ophir.

Ophir has been focused on Africa, including Tanzania, where it was an early mover, discovering gas, before BG Group farmed-in to its acreage. 

More recently, Ophir has been acquiring acreage in southeast Asia, including Myanmar and Indonesia. Salamander, meanwhile, has licenses in offshore Thailand. 

The combination would provide shareholders with exposure to 21 production, development and exploration blocks in South East Asia, as well as to Ophir's extensive footprint in Africa, said the two firms.

Salamander had been in discussion with CEPSA and Strategic Energy (Global), but both firms announced they no longer have an intention to make an offer for Salamander 

The move would throw a spanner into the works on a deal between Salamander and Sona Petroleum, announced on 21 July 2014, which would see Sona acquire an effective 40% working interest in the B8/38 concession (containing the Bualuang oil field) and the surrounding G4/50 concession, in the Gulf of Thailand. 

Ophir said: “Ophir, as enlarged by the combination with Salamander, would remain an exploration-led upstream company. By selectively re-investing cash flow from Salamander's current production, Ophir would be able to generate material cash flow for reinvestment in Ophir's proven business model, namely that of continued monetization of exploration / appraisal success.”

Tanzania update

Ophir also today announced that its Tende-1 well in East Pande, Tanzania, found traces of gas in the upper strata of the primary objective, the Cretaceous-aged Tende prospect, but that wireline logs confirmed that no moveable hydrocarbons were present in the prospect.

In the secondary Tikiti objective, the Tende-1 well encountered a gas bearing sandstone. No more details were given.  

Ophir said it would evaluate the wider impact of the find as it integrates the well results into its understanding of the remaining prospects in the East Pande block. 

The well was drilled using the Deepsea Metro I drillship in 781m water depth to a total depth of 4153m. 

The Deepsea Metro I then moved to Block 7 where the Mkuki-1 well was drilled to 3204m total depth. The well targeted a Tertiary-aged stratigraphic prospect in 1648m water depth and encountered a high quality sandstone sequence, but no hydrocarbons were present.

Read more: 

Ophir confirms offer for Salamander

Salamander announces first oil and Bualuang

Salamander announces Bualuang part-sale

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