News

December 07, 2009

Sterling Energy Concludes US Sale As It Clears The Decks Ahead Of Key Kurdistan Well

Sterling Energy has completed the sale of its US assets, a move that paves the way for an open offer to raise £20.6 million, repays the AIM firm’s outstanding debts and clears the decks ahead of the all important Sangaw North well in Kurdistan, which is due to spud later this month. The US$90 million sale to Korean outfit Atinum Group completes a process that began almost two years ago as Sterling shed its heavy debt burden and offload high cost producing assets in the US in favour of high impact wildcatting in Africa and the Middle East.

The US business, which lies in the hurricane-prone onshore and shallow water Gulf Coast region, carries a 2P reserve base of 94 billion cubic feet of gas equivalent and produces around 21.2 million cubic feet of gas equivalent per day, generating revenues of US$83.2 million in 2008.  But the company had little incentive to bump up these production numbers as production gains were tied to loan repayments and flagging gas prices in the US had tempered enthusiasm for the asset base. ...