Pacific Rubiales closes Kappa acquisition

Toronto-based Pacific Rubiales Energy (TSX: PEG) has closed the acquisition of Colombian oil company Kappa Energy for a cash payment of US$168mn, the Canadian company said in a statement.

The deal remains subject to minor post-closing adjustments and regulatory approval in Colombia.

Kappa has holdings in nine blocks in the Catatumbo, Llanos and Lower, Middle and Upper Magdalena basins of Colombia. The total land position is close to 750,000 acres (300,500ha).

As of May 31, Kappa had 10.3Mboe of 2P reserves and 24.2Mboe of 3P reserves. Nearly 166Mboe of further prospective resources have also been identified, according to the statement.

Pacific Rubiales aims to invest US$171mn in Kappa through 2009 to boost the company's production from its current 4,100boe/d to 10,000-12,000boe/d.

Pacific Rubiales, which boasts net production of roughly 22,500boe/d, operates the Rubiales heavy oilfield and La Creciente natural gas block in Colombia in addition to other assets in the country. The company also has operations in Peru.

Publication: Business News Americas - English News
Provider: Business News Americas
Date: September 8, 2008

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