TransGlobe Energy seeks acquisitions, to bid in Egypt’s International 2016 Bid Round – VP

03 Jun 16 – TransGlobe Energy Corporation [TSE:TGL; NASDAQ:TGA], a Calgary, Alberta-based oil and gas exploration and production firm, is seeking acquisitions in Egypt and in other OECD countries, Brett Norris, Vice President of Exploration said.

The company is looking to diversify outside of Egypt, its sole country with upstream assets, Norris said.

“Nothing beats being in different basins and taking shots in different areas,” he said.

The company is looking for onshore assets that have near-term production and exploration upside, and would consider Sub-Saharan Africa, and any other OECD country, Norris said. The company is aiming to do a deal within the next six months, he added.

TransGlobe is flexible on the stake size it would look to acquire, but it would prefer to take operatorship, Norris said.

In addition to this, TransGlobe is planning to take part in the next oil and gas bidding round in Egypt, he said.

In May Egyptian General Petroleum Corporation (EGPC) announced it had launched the International 2016 Bid Round to explore and exploit for oil and gas in Egypt under the Production Sharing Agreement model. The round includes 11 exploration blocks in the Gulf of Suez and Western Desert sedimentary basins. The bidding deadline is 31 August.

Acquisitions would mainly be funded by cash, Norris said. TransGlobe ended the first quarter of the year with a working capital of USD 75.2m (net of convertible debentures, which are now current liabilities), which includes cash and cash equivalents of USD 122m, according to a company presentation. The company booked a first quarter net loss of USD 16.2m, and has USD 66.5m of debt.

Production over 1Q16 averaged at 12,058 Bopd.

TransGlobe wholly owns several concessions in Egypt – South Alamein, West Bakr, NWG/SWG/SEG, NW Sitra, South Ghazalat, West Gharib. It is not looking to sell stakes in any of these assets, Norris said.

TransGlobe’s market capitalisation is USD 117.4m.

by Katie McQue

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