Pharos Backs out of Shell Purchase in Egypt

Egypt-focused Pharos Energy has dropped plans to acquire Shell's upstream operations in the country's Western Desert region, citing current market conditions. The independent's April 21 announcement came the day after US benchmark West Texas Intermediate front-month crude closed for the first time at a negative price: -$37.63/barrel.

Pharos, which produces around 5,600 boe/d at Egypt's El Fayum concession, announced in early March it was part of a consortium evaluating the takeover of Shell's assets, which include stakes in 19 producing oil and gas development leases along with four exploration permits in the Badr El Din and Obaiyed area. 

"In light of current market conditions, the board of Pharos has determined that an acquisition of the Western Desert assets is unlikely to be in shareholders' best interests and has accordingly decided to withdraw from the consortium that is evaluating that opportunity," Pharos said.

The London-listed company also has rights to the North Beni Suef exploration area in Egypt, produces oil and gas in Vietnam and is exploring for hydrocarbons in Israel.