ARKANSAS, Nov 16 (Future Headlines)- Karoon Energy, an Australian oil and gas explorer, has unveiled strategic deals valued at $720 million, signaling a significant move to diversify its operations beyond Brazil and Australia. The company is set to acquire stakes in offshore oil and gas fields in the Gulf of Mexico from LLOG Exploration, a U.S.-based player backed by Blackstone. The deals involve a 30% stake in the Who Dat and Dome Patrol fields and an approximately 16% stake in the Abilene field. To facilitate this expansion, Karoon Energy is launching a capital raise of around A$480 million ($312.43 million). The move positions Karoon Energy to enhance its global presence and contribute to its production portfolio.
To finance the acquisition of stakes in the Gulf of Mexico fields, Karoon Energy is initiating a capital raise of around A$480 million ($312.43 million). The capital raise involves issuing shares at A$2.05 apiece, representing a 14.6% discount to the stock’s closing price on Tuesday. Macquarie Capital is the sole lead manager and underwriter for this capital raise.
Karoon Energy’s strategic move involves acquiring a 30% stake in the Who Dat and Dome Patrol fields, along with an almost 16% stake in the Abilene field. These acquisitions signify the company’s commitment to expanding its asset portfolio and leveraging opportunities in the Gulf of Mexico.
The Who Dat field, part of the acquisitions, is anticipated to contribute approximately 4.0 million-4.5 million barrels of oil equivalent to Karoon Energy’s total output in 2024, considering net revenue interest. This addition is strategically positioned to offset a natural production decline from the company’s Bauna offshore operations, acquired from Petrobras in 2020.
LLOG Exploration, a significant player in the U.S. oil and gas sector, is one of the largest privately owned companies in the country. The operations of LLOG are supported by Blackstone, a prominent global investment firm. LLOG has been actively seeking to divest its Gulf of Mexico oil exploration joint venture, paving the way for Karoon Energy’s strategic acquisitions.
The Gulf of Mexico is a prolific region for oil and gas exploration, and Karoon Energy’s entry into this area signifies a strategic move to tap into its vast potential. The Gulf of Mexico remains a vital hub for global energy activities, and this expansion aligns with Karoon Energy’s vision for geographical diversification.
As part of the financing strategy, Karoon Energy has secured a new $340 million debt facility from a syndicate of banks, including Macquarie and Deutsche Bank. The company plans to draw down $274 million from this facility, providing a financial foundation for its stake acquisitions.
Reporting by Moe Khaled; Editing by Sarah White