Thursday, April 21, 2011

Parex acquires remaining interests in four Colombian blocks from Remora Energy for $255M

Parex Resources Inc has entered into a definitive agreement to acquire Columbus Energy Sucursal’s (a wholly owned subsidiary of Remora Energy) 50% share in four Llanos Basin blocks for total consideration of $255 million, subject to customary adjustments. Parex already holds the remaining 50% interest in the blocks. The acquisition is effective January 1, 2011 and is expected to close no later than June 29, 2011.

Acquisition Highlights :
-- Increases working interest from 50% to 100% in each of the four Llanos basin blocks namely, LLA-16, LLA-20, LLA-29 and LLA-30.
-- Block LLA-16: This block covers an area of 78,772 net acres and holds Kona multizone light oil discovery (35 degree API oil). In 2011, Parex expects to drill six appraisal/development wells on Block LLA-16 at the Kona discovery, of which two wells have been drilled and cased to date. Effective, March 31, 2011, it holds Proved Reserves of 1.066 MMbbl, 2P Reserves of 5.2 MMbbl and 3P Reserves of 9.6 MMbbl. Current production from the discovery is 1,160 BO/d. The block also holds few exploration prospects - Java, Sulawesi, Moragogi and Merida.
-- Exploartion activities are on going in Block LLA-20, LLA-29 and Block LLA-30.
-- The GLJ Report, effective March 31, 2011, included future development capital of $24.2 million for 2P reserves and $34.6 million for 3P reserves.
-- Acquisition metrics (excluding future development capital): 2P Reserves - $49.42/BOE and 3P Reserves - $26.48/BOE.
-- As of December 31, 2010, NPV-10 of 3P Reserves - $239.105 million and NPV-10 of 2P Reserves - $149.321

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