StockMarketWire.com - Oil and gas production Jadestone Energy said it had executed a sale and purchase agreement with SapuraOMV to acquire the latter's Peninsular Malaysia assets, for $9 million.

Under the terms of the deal, the company would acquire interests in four licences, two of which will be operated by the Jadestone.

The acquisition establishes a new operating presence for Jadestone in Malaysia, and adds cash flow from around 6,000 barrels oil equivalent per day on a net working interest basis, of which over 90% is oil, the company said.

SapuraOMV assets would boost the company's 2P reserves by 34%, adding 12.5 million barrels oil equivalent of net working interest 2P reserves.

'By our estimate, the acquisition will add 12.5 million barrels oil equivalent of 2P reserves, increasing total group reserves by over 30%,' the company said.

'Production will increase by 50% over the mid point of our 2021 guidance, and with the immediate add of cashflow from a high-value stream of 6,000 barrels oil equivalent per day, we are forecasting rapid payback, and therefore believe the acquisition will be value accretive to the business within the year,' it added.



At 10:00am: [LON:JSE] Jadestone Energy INC share price was 0p at 55p



Story provided by StockMarketWire.com