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Lukoil to acquire a 50% operator stake in the Area 4 project in Mexico, the transaction value is $435 mln

The Russian company has agreed to replace Houston-based Fieldwood Energy as operator of Area 4 off the coast of Mexico

Lukoil to acquire a 50% operator stake in the Area 4 project in Mexico, the transaction value is $435 mln

Moscow, July 5 - Neftegaz.RU. Lukoil announced today that the company has entered into an agreement to acquire a 50% operator interest in the Area 4 project in Mexico through the acquisition of the operator’s holding company.
The transaction amount is $435 million plus expenses actually incurred in 2021 as of the closing date of the transaction.

Area 4 includes 2 blocks, 58 in total, which are located 42 km offshore Mexico in the Gulf of Mexico.
The sea depth at the blocks is 30-45 m.
The project contains 2 oil fields:
  • Ichalkil
  • Pokoch
The fields' recoverable hydrocarbons reserves are estimated at 564 million barrels of oil equivalent, of which over 80% is crude oil.
Vagit Alekperov, President of LUKOIL, said:
  • LUKOIL considers Mexico a strategic region for the development of our international upstream operations
  • The new Project, where we will be the operator, is notable due to its considerable explored reserves and significant production potential
  • It naturally complements our existing portfolio of projects in the Gulf of Mexico
Production of 1st oil at the project is scheduled for the 3rd quarter of 2021.
The Project is developed in 3 phases, with a peak daily production rate estimated to be more than 115 000 barrels of oil equivalent.

The Project is implemented under a PSA, which was signed in 2016 for a period of 25 years with the right for an extension for up to 10 years.
The partner in the Project is PetroBal, the oil % gas subsidiary of Mexican conglomerate GrupoBAL, with the remaining 50% interest.

To read the full story in Russian

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