EnQuest Raises GBP107 Million to Fund Acquisition; 1st Half Net Profit Rose 48%
07 September 2018 - 5:13PM
Dow Jones News
By Oliver Griffin
EnQuest PLC (ENQ.LN) said Friday that it will raise 107 million
pounds ($138.3 million) in a rights issue to fund its acquisition
of BP PLC's (BP.LN) remaining interest in the Magnus field, and it
reported a 48% rise in first-half net profit.
The oil-and-gas company said the total price for BP's remaining
interest in the field is $300 million. The rights issue will be
used to fund the base consideration, while the remaining expense
will be paid to BP from the net cash flow generated by the newly
acquired interest.
To raise the GBP107 million, EnQuest said it will issue 508.3
million new shares to existing shareholders in a three-for-seven
rights issue, at a price of 21 pence a share.
EnQuest initially acquired a 25% interest in the Magnus field in
January, when it retained the option to acquire the remaining
interest and increase its stake in the field. The company said it
will raise an additional $27 million to fund the development of the
Canute infill well, and the T10/T11 infill well on the Magnus
field.
The company said profit in the six months ended June 30 rose to
$43.3 million, from $29.3 million in the year-earlier period, on
revenue that grew 61% to $550.8 million. During the first half,
average production increased 46% to 53,990 barrels of oil
equivalent a day, EnQuest said.
As well as exercising its option at the Magnus field, EnQuest
said it plans to exercise an option regarding its agreement with BP
to perform the physical decommissioning activities of the Thistle
and Deveron North Sea oil fields.
By exercising the option, EnQuest will now increase its payment
for decommissioning by $20 million, to a total of $50 million, and
has agreed to increase its payment obligation to 7.5% of BP's
decommissioning costs, which has an increased cap of GBP99
million.
The company reiterated its full-year production guidance of
between 50,000-58,000 barrels of oil equivalent a day.
Write to Oliver Griffin at oliver.griffin@dowjones.com;
@OliGGriffin
(END) Dow Jones Newswires
September 07, 2018 02:58 ET (06:58 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
Enquest (LSE:ENQ)
Historical Stock Chart
From Apr 2024 to May 2024
Enquest (LSE:ENQ)
Historical Stock Chart
From May 2023 to May 2024