PA Resources put pressure on the Tunisian government yesterday to give the green light on a £150million offshore farm-out deal.
The Swedish exploration and production firm warned that the agreed sale of 70% of its offshore assets to EnQuest was now uncertain due to delays in the ratification of a key part of the transaction by Tunisian authorities.
It is understood that the North Sea’s EnQuest has so far only paid around £13.8million up-front to secure the £150million farm-in. The Swedish firm made the announcement just days after US president Barack Obama pledged a further £300million assistance package to the country. He announced the support as he met with Tunisia’s acting prime minister Mehdi Jomaa at the White House on Friday.
Mr Obama welcomed progress in Tunisia after being among the first countries to overthrow its dictatorial regime in the so-called “Arab Spring” in 2011.
But the troubled country is struggling to close an estimated £1.2billion to £1.8billion hole in this year’s budget.
In addition to this, Mr Jomaa only began leading the caretaker government on a temporary basis in December after two rival heads of opposition parties were assassinated last year.
PA yesterday said the deal to get EnQuest involved with two offshore licenses – the Zarat Permit and the Didon Concession – was delayed due to the political situation. PA said that the deal rested on the government ratifying “Avenant 5” – an extension of the Zarat licence.
“Despite previous assurances from the Tunisian authorities that approval of Avenant 5 is imminent, it is becoming clear that a favourable decision is not certain in the short term,” the firm said in a statement.
“PA Resources is working hard, together with the relevant authorities, to expedite the approval process and will continue to explore all avenues to ensure the completion of the transaction and to realise the returns from the significant investments PA has made in these licences over many years,” it added.
EnQuest declined to comment but it told investors last month that it expects the deal to complete in the second half of this year in its annual update.
The North Sea firm yesterday confirmed that it had raised £391million from bond investors, up from the £300million it announced it planned to raise.
PA Resources is working hard to expedite the process