Halo Agrees Terms for Dutch Tullow Assets

Hague and London Oil (Halo) has agreed the conditional acquisition of significant non-operated natural gas production assets in the Dutch North Sea from the Dutch subsidiary of Tullow, based on an enterprise value of €4,752,675 ($5.03mn)), it said April 10.

Halo said the reverse takeover would bring it less risky “production opportunities in established hydrocarbon provinces with ample access to, and equity ownership of, infrastructure.”

Tullow receives an estimated amount of €9,752,429 on completion and contingent payments of up to €20,000,000 payable between 1 January 2019 and 1 January 2021.  

The deal comprises interests in offshore exploration and production licences on the Dutch Continental Shelf (DCS) within the Northern Area and Joint Development Area (JDA) in the western part of the DCS, which collectively generated total net production of 2,900 boepd in 2016.

Halo said the licences had stable field production and there is “potential for significant upside in proved undeveloped and probable reserves, and contingent resources.”

Halo is talking to potential finance providers to agree the terms of funding for the completion payment pursuant to the terms of the deal, while minimising dilution, it said.

Halo’s interim CEO Andrew Cochran said the “prolonged market downturn” had hit Halo’s ability to diversify and grow the portfolio sooner…. However the assets were likely to yield money soon, a critical factor in its screening process and likely to enable funding of the deal. He said: “We are looking forward to integrating this portfolio into Halo to continue on the future growth trajectory.”

Halo bought Wessex Petroleum in 2014 and has assets internationally, including southeast Asia, south America and Africa - including offshore the internationally contested territory of Western Sahara and the French East African territory of Juan de Nova between Madagascar and Mozambique.

William Powell