Abu Dhabi, UAEThursday 5 December 2019

Dana Gas confirms it is considering sale of Egyptian assets

Company is focusing its efforts on developing reserves in Kurdistan

Dana Gas is reviewing its assets in North Africa country. Jaime Puebla / The National
Dana Gas is reviewing its assets in North Africa country. Jaime Puebla / The National

Sharjah-based Dana Gas has confirmed that it is undertaking a strategic review of its Egyptian oil and gas assets with a view to selling them.

On Monday, the company said in a statement to the Abu Dhabi Securities Exchange (ADX), where its shares trade, that it had “hired financial advisers to look at a possible sale at full value, having substantially developed the said assets”. It added that it is currently focusing on the development of its oil and gas assets in the Kurdistan region of northern Iraq, which houses around 90 per cent of the company’s proved and probable reserves.

Dana Gas said that a potential sale process was still in its early stages.

“The company will notify the ADX if and when a deal is reached,” the statement said.

Dana Gas generated about 56 per cent of its energy output, or 35,200 of barrels of oil equivalent per day, in Egypt last year, according to the company’s website.

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An investor’s presentation issued alongside the company’s first-quarter results in May showed that Dana Gas’ proved and probable reserves in Egypt stood at 89 million barrels of oil equivalent last year. The company also has 14 development leases under three concessions in the Nile Delta region and a 26.4 per cent stake in a gas liquids extraction plant in the Gulf of Suez.

Last week, the company also announced that it had completed the drilling of its exploratory Merak-1 well in the North El Arish offshore (Block 6) concession area in Egypt but “did not encounter commercial hydrocarbons” and was plugging the well. It said that there were at least three other prospects within the same concession area with "material resource potential".

On Sunday, Reuters reported that Dana Gas hired investment bank Tudor, Pickering, Halt & Co to advise on the sale of its Egyptian assets.

Dana Gas has been operating in Egypt since 2007. Sharjah-based Crescent Petroleum is its biggest single shareholder, with a 19.67 per cent stake in the company, according to the ADX website.

Updated: July 30, 2019 04:01 PM