LONDON (Alliance News) - Kazakhstan-focused oil and gas company Max Petroleum PLC Tuesday said it is launching a strategic review which may result in a merger, the sale of the business, a farm-down, or a disposal of its assets.
The company has appointed Blackstone Group International Partners LLP as exclusive financial adviser to conduct the formal sale process.
"There can be no certainty that any offers will be made as a result of the formal sale process, that any sale or transaction will be concluded, nor as to the terms on which any offer might be made," Max Petroleum said.
The review comes just a month after Max Petroleum's shares slumped by a quarter after it said its proved and probable reserves, which include new drilling results from 35 wells, fell significantly when compared with the previous year.
The company said in June that a competent persons report carried out by Ryder Scott Co LLC estimated that the group had 9.5 million barrels of oil equivalent in proved and probable reserves with a post-tax net present value - discounted at 10% - of USD184 million at March 31.
The report showed that in the year the company's Zhana Makat site's proved and probable reserves had fallen 25% to 3.3 million barrels of oil equivalent, and its Asanketken site's proved and probable reserves had fallen 20% to 1.6 million barrels from 2.0 million barrels.
The number represents a decrease of 14% from 10.9 million barrels of oil equivalent at a net present value of USD184 million at the same point a year ago.
Max Petroleum also had said on Monday that negotiations with Sberbank of Russia remain ongoing to reset the technical production and reserves covenants under a USD90 million credit facility from Sberbank to reflect the current profile of Max Petroleum's reserves and production.
The company said it continues to meet its payment obligations under the facility.
Max Petroleum shares closed up 5.2% at 1.42 pence Tuesday.
By Anthony Tshibangu; anthonytshibangu@alliancenews.com; @AnthonyAllNews
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