Petroceltic transfers Greek licence rights to partners

Dublin and London-listed exploration company Petroceltic, which last week put itself up for sale has transferred its rights to a licence it part-owns in Greece to its consortium partners.

No financial details of the transfer were disclosed in the market update from Hellenic Petroleum, which together with Petroceltic and Edison International, was awarded the licence for the Patraikos block in the Gulf of Patra in July 2013.

The licence was to carry out seismic exploration and geological studies and Petroceltic’s net investment for the initial three years of the contract was estimated to be in the region of £3.5 million.

The Patraikos block covers an area of 1,892 square kilometres with water depths principally in the range of 100 to 300 metres.

Following completion of the transfer of Petroceltic’s interest in the block, which is subject to the consent of the Greek energy ministry, Hellenic and Edison will each hold a 50 per cent interest in the joint venture.

Petroceltic announced last week that it was up for sale and had appointed Bank of America Merrill Lynch and Davy Corporate Finance to talk to potential buyers after a breach of banking covenants on its debts of over $200 million (€183m).

The advisers have also been asked to look at other restructuring options in a strategic review, including a farm out of sale or some assets, a merger with a third party or the raising of new equity or debt capital. Petroceltic has oil and gas assets in Algeria, Egypt, Italy and Greece.

Petroceltic has debts of $217.8 million, while it has cash balances of $28.1 million, of which $24.6 million is held in local currencies and is “not readily convertible”, the group said last Wednesday.