IGC to buy stake in Kazakhstan oil project for $152m
October 7. The West Australian
Shares in International Goldfields Corporation jumped after the company said it would take a 50 per cent stake in a Kazakhstan oil project for $152m and sell its stake in a South African platinum project to joint venture partner Nkwe for $60m.
The oil asset purchase, which IGC described as a ‘company-making’ deal, would be done by way of an all-scrip issue of 675.9 million new shares and 135.2 million options to owners UK private company Eastern Petroleum.
An additional 193.9 million options would be issued to various consultants.
IGC said it would also raise $20 million through an institutional placement.
The company said an independent valuation prepared by oil and gas consultants Miller and Lents valued Eastern’s stake in the project at $559 million.
IGC said it had also executed a formal asset sale agreement with Nkwe to sell its 15 per cent stake in the Tubatse project in South Africa.
The money will be paid in tranches and be subject to government, regulatory and shareholder approvals.
IGC executive chairman Tony Sage said receipt of the first payment of $9 million would provide the company with the financial backing to finalise negotiations for the Kazakhstan oil acquisition.
“We have been reviewing a number of significant acquisition opportunities for the past six to 12 months and with this first payment received, and a substantial payment to be made in the coming month, we will have been able to finalise the most prospective of these acquisitions,” he said.
IGC shares were up three cents, or 13.64 per cent, to 25 cents at 9.40am after returning from a trading halt.