French energy supermajor TotalEnergies has sold its non-operated 18% stake in the Sarsang oil field in Iraqi Kurdistan to ShaMaran Petroleum for $155 million.
The Sarsang field, discovered in 2011, is 62% operated by HKN, while 20% is held by the Kurdistan Regional Government, which controls the autonomous region in northern Iraq. TotalEnergies’ 18% equity stake in production last year was around 3,500 barrels per day.
ShaMaran, listed in Toronto and Sweden, focuses on oil exploration and development in Iraqi Kurdistan.
ShaMaran chief executive Adel Chaouch described the acquisition, which has an effective date of January 1, 2021, as “a momentous day for ShaMaran”.
He added that the deal “transformed” ShaMaran from a single-asset company to one with stakes in the production of oilfields – Atrush, Swara Tika and East Swara Tika – in Iraqi Kurdistan.
“Based on advice from the Sarsang operator, ShaMaran’s net production will more than double on a pro forma basis, positioning ShaMaran among the top five international oil companies in [Iraqi] Kurdistan on a net production basis,” he said.
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“We also expect our reserves to more than double and the company will advise the market of this significant reserve acquisition in due course.”
The completed transaction has a firm price of $155 million, while additional contingent consideration of $15 million may be payable in the future depending on production and the price of oil.
TotalEnergies has been present upstream in Iraq since the 1920s, when it discovered the Kirkuk field. The company currently holds a 22.5% interest in the Halfaya oilfield. Its production in Iraq was around 14,000 barrels of oil equivalent per day in 2021.
Last September, the French company signed major multi-energy agreements in Iraq relating to the construction of a new gas network and treatment units, the construction of a seawater treatment unit in scale and the construction of a 1 gigawatt photovoltaic power plant.