Canada-based upstream natural gas company Valeura Energy has agreed to sell its shallow conventional gas business in Turkey for $15.5 million to its UK-based joint venture Thrace Basin Natural Gas (TBNG), the company announced on Tuesday.
The transaction is structured as a share sale of TBNG (Turkiye) Corporation and Corporate Resources BV, both wholly-owned subsidiaries of Valeura.
Valeura will be entitled to royalty payments over five years, tied to local gas prices, which is anticipated to range from $1 million to $2.5 million.
Valeura anticipates closing the deal in the first quarter of 2021.
According to the statement, the company will maintain access to local gas markets via the existing gas transport and processing networks for use in its ongoing deep gas assessment activities.
"Valeura remains committed to its ongoing business in Turkey and continues to hold its long-standing relationships with Turkish authorities in the highest regard. This transaction is another example of Valeura bringing new foreign investment into Turkey’s upstream sector and places the conventional producing assets in capable hands, while maintaining its position within the country," the statement read.
The transaction will bolster Valeura’s growth strategy through mergers and acquisitions and further appraisal of its deep gas play, the company said.
Valeura produces crude oil and natural gas from conventional reservoirs in the Thrace Basin of northwest Turkey and is focused on appraising and developing a deeper unconventional tight gas play.
By Firdevs Yuksel and Sibel Morrow