By Margit Feher
BUDAPEST--Hungarian oil and gas company MOL Nyrt. (MOL.BU) has
agreed with Ithaca Energy Inc. (IAE.T) to buy Ithaca Energy's
subsidiary in Norway, Ithaca Petroleum Norge AS for an initial
amount of $60 million, the two companies said Friday.
Ithaca Energy, a North Sea-focused oil and gas operator, could
also receive up to $30 million from MOL as an additional bonus
payment dependent on exploration success from the existing licence
portfolio.
MOL will finance the deal from its operating cash flow, MOL said
in a release.
The deal fits MOL's strategy to increase its exploration and
development activities, the company added. IPN's portfolio includes
14 licences in the Norwegian continental shelf, out of which three
are operated by IPN.
The licenses provide an oil weighted exploration portfolio with
net unrisked best estimate prospective resources of more than 600
million barrels of oil equivalent.
Having now entered Norway, MOL plans to further extend its
portfolio there with adding additional assets and licenses to IPN.
MOL targets ultimately becoming "a well reputed offshore operator
in the region," it said.
MOL also said there is potential for synergy with its existing
North Sea operations in the U.K., it added.
As for Ithaca Energy, after repayment of Ithaca Energy Inc.'s
Norwegian exploration financing facility and estimated working
capital adjustments, the sale is expected to result in an initial
net cash receipt of about $30 million, Ithaca Energy said.
Ithaca Energy will use the incoming cash to pay off debt, it
said.
Any potential future bonus payments depend on successful
discoveries being drilled on IPN's existing licence portfolio
between 2015 and 2017, with payments based on a sliding scale
depending on discovery size, Ithaca Energy said.
Write to Margit Feher at margit.feher@wsj.com; Twitter:
@margitfeher