Acquistion Transforms IGas

IGas Energy plc has agreed to buy U.K. oil onshore producer Star Energy Group Ltd. from Malaysia’s PETRONAS International Corporation Limited for 110 million pounds ($173 million).

The move is a big step up for the U.K. coal-bed methane producer, acquiring an estimated 2011 production of 2,800 boepd.

The acquisition comprises the UK onshore production assets of Star Energy but excludes certain non-UK assets and the gas storage business currently conducted by Star Energy.

Andrew Austin, CEO of IGas Energy, commented:

“This is a transformational deal for IGas Energy. With this Acquisition we will be creating a substantial onshore oil and gas company in the UK. The enlarged group is expected to have a growing production profile as IGas Energy’s combined oil and gas resources are developed.”

In addition, the GSA with PETRONAS Energy Trading Limited offers an important partnership and a customer for our gas as it comes on stream. This agreement constitutes a significant step towards the migration of our resource base to reserves.”

Star Energy’s assets are estimated by independent reserves assessor Senergy to be 11.1mmboe of 2P reserves with an additional 4.5mmboe of 2C resources, as at as at 30th June 2011.

The purchase will be funded by a $140 million debt facility provided by Macquarie Bank Ltd.

Source:  Igas Energy plc