KUALA LUMPUR, April 22 — Sapura Energy’s wholly-owned subsidiary, Sapura Upstream Assets Sdn Bhd, has entered into a conditional agreement to divest its entire 50 per cent equity interest in SapuraOMV Upstream Sdn Bhd to France-based TotalEnergies Holdings SAS for US$530.3 million (RM2.53 billion) in cash.

Sapura Energy said it will also be relieved by TotalEnergies of a US$175 million obligation in respect of a financing facility extended by OMV Exploration & Production GmbH (OMV E&P) to SapuraOMV, in connection with the share subscription and restructuring exercise among Sapura Energy, OMV E&P, SapuraOMV, and Sapura Upstream on January 31, 2019.

“Consequently, the total disposal consideration for the transaction, encompassing both the cash payment of US$530.3 million and the release of the US$175 million obligation, amounts to US$705.3 million (RM3.37 billion),” Sapura Energy said in a statement today.

This agreement follows a deal signed earlier this year by TotalEnergies to acquire the other 50 per cent stake in SapuraOMV from Austria-based OMV AG.

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Sapura Energy said the proposed divestment is expected to result in a net gain on disposal of about RM793 million upon its completion, enhancing the financial position of the group.

Under the terms of the agreement, the acquisition is subject to regulatory approvals and customary closing adjustments. To account for regulatory approvals from certain jurisdictions, the closing is expected no later than the second half of 2025.

“Nevertheless, the management of both Sapura Energy and TotalEnergies are committed to expediting the completion of this transaction by year-end,” the company said.

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Sapura Energy said it had actively pursued the divestment of its stake in SapuraOMV, in line with the restructuring exercise to address its unsustainable debt and outstanding payables.

“Net disposal proceeds will be utilised mainly to settle amounts owing to Sapura Energy’s relevant scheme creditors, including its multi-currency financing lenders,” it said.

Sapura Energy Group chief executive officer Datuk Mohd Anuar Taib said with full ownership of SapuraOMV, the group is confident that TotalEnergies will provide the right focus to further develop the growth potential of its assets.

“This portfolio rationalisation marks our strategic shift away from the exploration and production business, as we enhance our core capabilities to deliver innovative solutions to the dynamic energy industry,” he said.

Sapura Energy’s remaining core business segments are engineering and construction, drilling, and operations and maintenance, with a collective order book of about RM6.6 billion.

SapuraOMV has operations with different stages of the oil and gas lifecycle located in Malaysia, Australia, New Zealand and Mexico.

SapuraOMV’s assets include a 40 per cent operated interest in Block SK408 and a 30 per cent operated interest in Block SK310, both situated offshore Sarawak.

“The development of the Jerun gas field within Block SK408 remains on track for startup in the latter half of 2024,” it added. — Bernama