Stake in Egyptian Oil Bought by Beach

Oil and gas producer Beach Petroleum Ltd has been given the nod by Egypt's government to acquire interests in two oil discoveries in the Gulf of Suez to diversify its operations.

First production from the fields, North Shadwan and Santos Egypt-operated South East July, is planned for late in 2009.

"Beach could begin to reap its share of oil production from the North Shadwan concession as early as next year," Beach said.

Under an agreement with Tri-Ocean Energy Company, Beach is acquiring a 20 per cent interest in the North Shadwan discovery for $US110 million.

"Funds in US dollars for this acquisition were converted at an effective rate of AUD:USD of 0.9109 in July this year and have been held in escrow since then," Beach said, giving the acquisition a cost of $A100.19 million.

Beach did not reveal the cost of the South East July acquisition.

Shares in Beach were down three cents, or 2.96 per cent, to 98.5 cents at 1155 AEDT Friday.

Author: Jo Amey