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KrisEnergy to Divest its Interest in the Block A Aceh Gas Project

Source: www.gulfoilandgas.com 3/1/2018, Location: Asia

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Announcing a financial and operational update, KrisEnergy said a capital markets restructuring was undertaken in late 2016/early 2017 and the Group’s business strategy was reset to focus capital resources on producing assets, short-cycle development projects in the core Gulf of Thailand area and any mandatory commitment work under the Company’s licences.

As a result of the realignment, KrisEnergy farmed out a 21.6666% working interest in the Block A Aceh production sharing contract ('PSC') in April 2017 and reduced its holding to 15.0%. In the fourth quarter 2017, it was further decided to cease participation in the Block A Aceh gas project to preserve cash flow and reduce the Company’s risk exposure. The Company is awaiting Government of Indonesia approval for the takeover of its residual working interest.

As a result of the Block A Aceh cessation, the Group incurred a US$120.7 million charge relating to non-cash impairment and write down during 2017. An additional write down for the relinquishment of the Kutai PSC and higher finance costs associated with the capital markets restructuring, resulted in a Group net loss after tax of US$139.2 million. Net cash flow from operations improved during 2017, amounting to US$23.1 million versus net cash flow used in operating activities of US$4.3 million for the 2016 financial year.

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Related Categories: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Industrial Development  Insurance  Investment  Mergers and Acquisitions  Risk Management 

Related Articles: Accounting, Statistics  Acquisitions and Divestitures  Asset Portfolio Management  Economics/Financial Analysis  General  Insurance  Investment  Mergers and Acquisitions  Risk Management 


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