RE:RE:WOW=== Spending $155 Million US That they don't haveIn my opinion this is a very good deal. End of 2020 there were discussions at Total, that they see a value and price of 500 million $ for their share of the HKN operated asset (if my info is correct).
Snm pays 155 millions only = good deal for Snm (1st advantage Snm)
Total did not wait for the best timing to sell their share of these 2 oil fields (=2nd advantage Snm)which Total got when they bought Maersk ( so it was an asset not selected and hand picked by Total that means more a stepchild for Total) (= 3rd advantage Snm).
And Snm can stand the heat, risk of the N Irak Kurdistan kitchen full of political , security risks and corruption.
155 million $ is relatively small money for a world class reservoirs (high OOIP, good permeability, fractures, high production rates per well, already some existing facilities and infrastructure, existing midstream and marketing etc), on the other hand N Irak Kurdistan is high risk, a lower future oil price could be some risk for the 300 million $ loan -- but the reward of this deal can be very good and high. Another 5.000 bbl/d now is nice, and alltogether 10.000 bbl/d from this bought asset in 2022 is great. I like this typical Lundin style deal.