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Whitehellon Sep 10, 2013 9:55am
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Sea Dragon enters into agreement to sell entire interest in Kom Ombo Concession
Sea Dragon enters into agreement to sell entire interest in Kom Ombo Concession Sea Dragon enters into agreement to sell entire interest in Kom Ombo Concession
Tuesday, September 10, 2013
Sea Dragon enters into agreement to sell entire interest in Kom Ombo Concession
09:25 EDT Tuesday, September 10, 2013
/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES/
CALGARY, Sept. 10, 2013 /CNW/ -Sea Dragon Energy Inc. ("Sea Dragon" or the "Company") (TSX VENTURE: SDX) announces that it has entered into a share purchase agreement (the "Agreement") dated September 9, 2013 with a private company (the "Purchaser") to sell all of the issued and outstanding shares of its indirect wholly-owned subsidiary Sea Dragon Energy (Kom Ombo) Ltd. ("Kom Ombo") for cash consideration of US$6 million, to be paid at closing, plus adjustments in favour of Sea Dragon estimated to be approximately US$1.2 million, to be paid in four equal monthly installments, commencing the month following closing (the "Disposition").
Sea Dragon owns a 50% participating interest in the Kom Ombo Concession which is located in the southern part of the Arab Republic of Egypt, approximately 1000 kms south of Cairo. The concession, which was acquired in April of 2010, consists of 2 producing fields, Al Baraka and West Al Baraka produces approximately 412 BOPD of which 206 is net to Sea Dragon. Management estimates of the concession reserves as of year-end 2012 were approximately 1.3 mmbbls of which 0.65 mmbbls was net to the Company.
Said Arrata, Chairman of Sea Dragon commented on the acquisition transaction: "The Company has recently completed a review of both its strategy and existing asset portfolio. As a result, Kom Ombo was no longer core and the decision was made to sell it. The funds generated from this sale will be reinvested into our Gulf of Suez Fairway producing assets where we recently acquired the Shukheir Marine concession. It has been exciting to open a new area of production in Egypt with these two exploration discoveries in Kom Ombo but given our new focus these assets are better suited for another company's portfolio. I look forward to reporting on the future investments we make from these funds in due course."
The Disposition is subject to the receipt of all necessary regulatory, stock exchange and other third party consents (including the consent of Sea Dragon's lender) and satisfaction of other closing conditions that are customary for a transaction of this nature. It is anticipated that closing of the Disposition will occur on or about September 30, 2013.