Karoon Energy to launch raising for US acquisition; Macq on the ticket

afr.com:

Karoon Energy is raising around $US300 million ($460 million) via Macquarie Capital, to fund the purchase of assets in the Gulf of Mexico from the privately held LLOG Exploration Company.

Shares in the Brazilian oil and gas play last traded at $2.15 each, before they entered a trading halt following Street Talk’s initial report on the deal. That gives the ASX-listed group a market capitalisation of some $1.2 billion.

Karoon has become a material Australian mid-cap oil producer from its single Brazilian oil field. 

The mid-cap producer last reported a net cash position of $US151.5 million made up of $US181.5 million in cash and $US30 million of drawn debt. Oil sales jumped 66 per cent in the September quarter to $US203.9 million. Karoon said it produced 2.85 million barrels in the quarter.

LLOG’s Gulf of Mexico operations have been backed by Blackstone since 2012, when the partnership committed to investing $US1.2 billion. LLOG is one of the largest privately owned oil and gas companies in the United States and one of the largest private operators in the Gulf of Mexico.

Sources said the assets being acquired by Karoon were not those that LLOG had owned with the private equity giant. Instead, they relate to an asset known as the Who Dat field, which has an estimate reserve of between 200 million and 300 million barrels of oil equivalent.

Karoon has assets in Australia and Brazil including its Bauna offshore operations which it acquired from Brazil’s state-controlled Petrobras in 2020. The $US665 million deal transformed the explorer into a producer after management had sat on hundreds of millions of dollars in cash for half a decade following the sale of its West Australian gas field in 2014 to Origin Energy for $US600