Maersk in Kenya, Ethiopia acquisition

Maersk Oil will buy assets in Kenya and Ethiopia for a projected value of $845 million, the Danish oil and gas company announced in a Monday statement.

Canadian oil and gas company Africa Oil Corporation will farm out its interests in this deal. Maersk will have a 25-percent interest in blocks 10BB, 13T and 10BA in Kenya, a 25-percent stake in Rift Basin and a 15-percent interest in South Omo Block in Ethiopia.

The farm-in entails that Maersk will pay $365 million upfront for half of the costs incurred by Africa Oil before the effective date of March 30, 2015 and contingent future payments of as much as $480 million.

Although Maersk has been slashing its upstream activities during the downturn in oil prices, the company saw the farm in as an opportunity to rebuild its portfolio and grow its reserves.

“As part of the Maersk Group, we are in a position where we can take advantage of opportunities arising in current market conditions. This is an important driver of long-term value,” Jakob Thomasen, CEO of Maersk Oil, said in the statement.

Image courtesy of Maersk Oil