The UK's BP has agreed to sell the upstream assets of its German subsidiary Veba Oil & Gas (VOG)to Calgary-based Petro-Canada, the Canadian firm announced on 29 January. The estimated $2,000 million deal complements Petro-Canada's existing exploration and production activities in Algeria, Tunisia and Libya (MEED 7:12:01).
Several international companies, among them Australia's Woodside Petroleum, had submitted offers for VOG, which produces about 165,000 barrels of oil equivalent a day in the Middle East.
'This is a highly strategic acquisition for Petro-Canada, as the Veba assets and organisation build on our existing capabilities,' Petro-Canada's chief executive officer and president Ron Brenneman said. 'This deal is an excellent fit for us - it positions Petro-Canada in some of the world's most prolific and high-potential petroleum basins, its size is significant but manageable and it adds significant value for shareholders.'
Libya is VOG's most important market where it trades under the name of its wholly-owned subsidiary Veba Oil Libya (VOL).
The company produces an estimated 90,000 barrels of oil equivalent a day from the Zenad/Ghani field in Block NC-11 and the Jofra, Lehib/Dor Marada, Tibisti, Barrut North and Amal fields in the Sirte basin. VOL's partner is the National Oil Corporation(MEED 30:11:01). The deal will add to Petro-Canada's existing assets in Libya. The company in mid 2001 acquired a 25 per cent stake in the 100 million-barrel En-Naga field from Sweden's Lundin Oil(MEED 6:7:01)
In Syria, VOG is a partner with the Royal Dutch/Shell Groupand the Syrian Petroleum Companyin Al-Furat Petroleum Company (AFPC). AFPC produced some 300,000 barrels a day (b/d) of oil last year.
In Egypt, VOG holds a 49 per cent stake in the German Oil & Gas Egypt Company, which produces about 50,000 b/d from the Ras Budran, Ras Fanar and Zeit Bay fields in the Gulf of Suez (Oil & Gas, MEED Special Report, 23:3:01, pages 36-37).
Petro-Canada produces about 3,700 b/d of oil from Algeria's Tamadanet field, located on the Tinrhert Block, some 1,000 kilometres southeast of Algiers. In Tunisia, the company has exclusive rights to explore in the Tatouine Block.
Besides its North African interests, VOG's assets are located in the North Sea and Latin America. Petro-Canada said that it intends to manage its international operations through a wholly-owned subsidiary, which will continue to be located in Essen.
BP last July agreed to purchase a 51 per cent stake in VOG's parent company Veba Oelfrom the German utility E.ON. The deal will become effective on 1 February (MEED 27:7:01).
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