Karoon Concludes $720M Acquisition of Stakes in US Oil and Gas Fields

Australia's Karoon Energy has completed the acquisition of interests from LLOG Exploration Offshore and LLOG Omega Holdings for the U.S. Gulf of Mexico oil and gas fields.

The acquisition includes a 30% working interest in the Who Dat and Dome Patrol oil and gas fields and associated infrastructure, an approximately 16% working interest in the Abilene field and varying interests in adjacent exploration acreage.

The effective date of the transaction is October 1, 2023.

On completion, Karoon paid $684 million to LLOG Exploration Offshore and LLOG Omega Holdings, as the deposit of $36 million was already paid.

In addition, payments totaling $15 million were made in establishment and underwriting fees relating to the debt and equity processes.

The closing payment was funded by a $274 million drawdown on the company’s $340 million new debt facility, $312 3 million raised from a fully underwritten equity issue and the balance from existing cash reserves.

Karoon has received the economic benefit of the 30% interest in the acquired assets since October 2023.

Julian Fowles, Karoon’s Managing Director and CEO said: “We are delighted to have completed the Who Dat acquisition. This transaction is expected to be both value and earnings accretive for Karoon. The Who Dat and Dome Patrol fields are low cost producing assets with near- and medium-term expansion opportunities, located in a prolific, world class hydrocarbon basin in a stable and well understood regulatory and fiscal jurisdiction.

According to Fowles, the transaction provides a number of strategic benefits to Karoon, including increased scale and both asset and geographic diversification.

“This long life producing asset, together with the appraisal and exploration opportunities, will also help offset the natural decline from the Baúna Project in Brazil. We look forward to working closely with LLOG, a well respected and established offshore U.S. Gulf of Mexico operator, and the other joint venture partners to optimize the value of the Who Dat assets,” added Fowles.