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SacOil acquires Egyptian oil field

Published: 23:46 10 Sep 2014 AEST

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SacOil (LON:SAC) announced the acquisition of the Lagia onshore oil field, on Egypt’s Sinai peninsula.

Lagia has just over 6mln barrels of proved and probable oil reserves and SacOil believes it can establish production of 1,000 barrels per day by the end of next year.

SacOil chief executive Dr Thabo Kgogo described the deal as a significant milestone in the history of the company.

In a statement Kgogo said: “[It] endorses our short to medium term strategy of balancing our existing exploration and appraisal portfolio with lower risk production and development assets.

“We welcome our new shareholders and this opportunity to expand into a new geographical location, which continues our strategy of building a substantial Pan African company".

"This acquisition represents the first booked reserves for the company and through our anticipated development programme, we will be targeting a daily production rate from the Lagia oil field of more than 1,000 barrels of oil per day by Q4 2015." 

Acquiring the field will cost up to US$10mln paid in SacOil shares and SacOil has committed to settling the seller’s liabilities up to US$4.1mln – though the share based consideration may be reduced of the liabilities exceed that threshold.

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