PTT Exploration and Production Public Company (based in Bangkok) and Shell (global energy firm) are among those interested in Cove Energy. The company will mark its entry into Mozambique and Kenya through its planned acquisition through Shell Exploration and Production, an indirect and wholly-owned subsidiary. It will be Shell’s first foray into the East African region and the second on the continent, if it is successful.
PTTEP has operations in more than 13 countries including Algeria where it acts as the sole investment, in Africa. Shell proposed an offer that is valued at $1.5 billion while PTTEP’s stands at $1.8 billion. The two firms’ offer indicates that the proposed deal is subject to the consent of Mozambique’s Ministry of Mineral Resources as required by a contract for Cove Energy’s interests in the country.
“Discussions are going on with the two firms. There is no certainty that any offer would be made for the company,” Cove Energy board said in a statement. It also added, it reserves the right to reject any participant at any time.
Shell rates itself as one of the world’s largest liquid natural gas producers in East Africa as “a major prospective hydrocarbon province. It is in joint ventures with partners. Shell produces liquid natural gas in Australia, Brunei, Malaysia, Nigeria, Oman, Russia and Qatar. In 2011, it jointly supplied more than 30 per cent of global liquid natural gas volumes. While PTTEP is listed on the stock exchange of Thailand. It describes itself as one of the largest producers of oil and gas in Asia. It took up a 40 per cent stake in the Kai Kos Dehseh Oil Sands Project in Canada recently.
PTTEP has indicated that the Cove Energy board recommend the proposed offer unanimously on an unqualified basis and that its directors provide an irrevocable undertaking to accept it, which both suitors are insisting on as a pre-condition for announcing a firm intention to make the proposed offer.
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