LNG

NewMed Energy, a stakeholder in the largest Israeli offshore natural gas field and a likely future LNG feed-gas supplier, said it was looking more unlikely that it would proceed with the process of being listed on the London Stock Exchange through a reverse takeover of UK company Capricorn Energy.

The expected completion date of the NewMed merger with London-listed Capricorn was the first quarter of 2023.

However, Capricorn has been caught up in a dispute with a major shareholder and has put back a meeting of all shareholders to approve the deal with NewMed.

Capricorn had previously cancelled its proposed merger with UK rival Tullow Oil in favour of the combination with Israel’s NewMed, which was first announced on September 29, 2022.

There had been plans for a $1.4 billion merger between Tullow and Capricorn, which is based in Edinburgh and was formerly known as Cairn Energy.

Among its assets, NewMed holds the rights to 45 percent of the Leviathan Israeli offshore gas field with the other major shareholder in the field being Chevron Corp.

Cyprus gas field

NewMed also has the Aphrodite gas field in Cyprus's offshore economic zone waters, making it one of the biggest players in the East Mediterranean.

In the latest merger developments, Capricorn released a statement to the London Stock Exchange whereby it had decided to adjourn Capricorn's shareholder meeting called for the purpose of approving the NewMed transaction, to February 22 instead of February 1.

An alternative shareholder meeting was called at the request of one significant Capricorn shareholder, Palliser Capital (UK) Ltd., for the replacement of the serving directors of Capricorn with new directors that were proposed by Palliser and a meeting for this purpose was then scheduled to take place on February 1 instead of a meeting to approve the NewMed deal.

Members of the board of Capricorn, including the Chairman of the board and the Chief Executive, resigned immediately from the board and it was also the intention of two other directors, including the Chief Finance Officer, to resign from the board before the February 1 meeting called at the request of Palliser.

NewMed said that in view of these developments and the resignation of most of the Capricorn board members, the probability for the closing of the UK transaction had “significantly decreased”.

The Israeli company said it was continuing to examine strategic alternatives with the aim of “maximizing value” for its own shareholders.

NewMed is currently in the midst of plans to promote the expansion of the Leviathan gas field offshore Israel and the development of the Aphrodite reservoir alongside the launch of exploration and production of natural gas in other Middle East countries.

The Leviathan gas field in addition to supplying the Israeli domestic market also supplies Egypt and Jordan with gas and has existing plans to possibly supply feed gas for liquefaction at the two Egyptian LNG plants, Idku and Damietta, located east of Alexandria.

NewMed Energy, formerly Delek Drilling and owner of the largest Israeli offshore natural gas field and a likely future LNG feed-gas supplier, is continuing with the process of being listed on the London Stock Exchange through a reverse takeover of UK company Capricorn Energy.

Kosmos Energy, the US-based shareholder in the floating liquefied natural gas joint venture offshore the West African nations of Mauritania and Senegal, has adjusted its shareholdings for the pre-emption rights of Tullow Oil plc of the UK after spending $550 million to acquire shareholdings in oil and gas fields offshore Ghana from Occidental Petroleum of the US.

Kosmos, a specialist in Atlantic Margin exploration and production and based in Dallas, Texas, had agreed in October 2021 to acquire an additional 18 percent interest in the Jubilee field and an additional 11 percent stake in the Tweneboa, Enyenra and Ntomme (TEN) oil and gas fields offshore of Ghana.

Ghana National Petroleum Corp. (GNPC) was also acquiring stakes in the same fields from Occidental for $200M and will be the main partner of Kosmos.

The new Kosmos focus on Ghana comes as FLNG projects being developed with UK major BP offshore Mauritania and Senegal continue to progress, centred on the Greater Tortue-Ahmeyim gas fields.

The first Mauritania-Senegal FLNG production facility is scheduled to have first gas in early 2023.

Kosmos explained that in Ghana after execution of definitive transaction documentation and receipt of required government approvals, Kosmos and Tullow have now concluded their pre-emption transaction.

For another shareholder PetroSA of South Africa, the process is ongoing and remained subject to execution of definitive agreements and required government approvals.

Reductions

Following completion of the pre-emption by both Tullow and PetroSA, the ultimate interest of Kosmos will be reduced in Jubilee by 3.8 percent to 38.3 percent.

Under the changes Kosmos would retain 80 percent of the original acquired interest.

The ultimate Kosmos interest in the Tweneboa, Enyenra and Ntomme oil and gas fields offshore of Ghana will be reduced by 8.3 percent to 19.8 percent with Kosmos retaining 25 percent of the original acquired interest.

The consideration paid to Kosmos from Tullow after taking into account closing adjustments was around $118 million in the first quarter.

An additional $10M is expected to be payable on completion of the PetroSA pre-emption process and Kosmos plans to accelerate debt reduction with the proceeds.

The net 2022 production impact of the pre-emption exercise for Kosmos is a reduction of about 4,000 barrels of oil per day and is expected to result in one less Ghana cargo lifting this year and a reduction in 2022 capital expenditure of around $30M.

LNG progress

Kosmos said in its March 2022 earnings that the Mauritania-Senegal FLNG venture was 70 percent completed.

Both BP and Kosmos said the Greater Tortue-Ahmeyim LNG project had made steady progress in 2021.

All eight process modules have now been lifted onto the deck of the Floating Production Storage Offloading unit and mechanical completion of the process sub-systems was underway,

Construction was also completed of the 21st and final caisson of the breakwater and the subsea pipe-laying vessel completed its nautical trials in preparation for the offshore installation campaign in the second quarter of 2022.

Kosmos said that the FLNG hull had all four mixed-refrigerant compressors lifted onboard and pipe-rack installation operations had commenced.