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Santos: Sale of Indonesia, SE Asia blocks to Ophir completed in H2

Oyong Field Barge in offshore East Java [Image credit: Cue Energy)
JAKARTA ( – Santos Pte Ltd, an Australian oil and gas company, said the sale of its oil and gas blocks in Indonesia and other Southeast Asian countries to be completed in the second half of 2018. The allows the company to focus on developing its gas projects in Australia and Papua New Gunea.

On May 3, Santos announced the sale of its non-core Asian portfolio to Ophir Energy Pld, a UK oil and gas company, for US$221 million. The announcement came as the Indonesian Petroleum Association held their major annual convention and conference (IPA Convex) in Jakarta on May 2-4).

Completion is expected in the second half of 2018 and is subject to customary consents and approvals for a transaction of this nature, Santo said in a statement.

Completion is also subject to approval by Ophir shareholders as required under London Stock Exchange regulations, expected to take place in June 2018.

The sale is consistent with Santos’ strategy to realise value from its late-life non-core assets and will result in Santos making country exits from Vietnam, Indonesia, Malaysia and Bangladesh, the company said.

The assets sold to Ophir include the following interests:

  • 875% in the Block 12W PSC2(Chim Sáo and Dua oil fields), Vietnam;
  • 5% in the Madura Offshore PSC (Maleo and Peluang gas fields), Indonesia;
  • 45% in the Sampang PSC (Oyong and Wortel gas fields), Indonesia;
  • 20% in the Deepwater Block R PSC (Bestari oil discovery), Malaysia;
  • 45% in the SS-11 PSC, Bangladesh;
  • 50% in Block 123 PSC and 40% in Block 124 PSC, Vietnam.

All Santos employees associated with these assets will transfer to Ophir as part of the sale, Santo said.

The producing assets sold are relatively late-life and are not prioritised for capital in the Santos portfolio. Santos’ share of production from the assets in the first quarter of 2018 was 1.4 million barrels of oil equivalent.

Santos Managing Director and Chief Executive Officer Kevin Gallagher said: “The sale of the Asian assets further delivers on our undertaking to simplify our business and focus on our five core long-life natural gas assets in Australia and Papua New Guinea.”

“We have always believed the Asian assets are a quality portfolio and are pleased to achieve an attractive outcome for our shareholders. Santos will work with Ophir to ensure a smooth transition, including the transfer of all the Santos employees to Ophir.”

Proceeds from the sale will be applied to further reduce Santos’ net debt, which stood at US$2.5 billion at the end of March 2018.

Santo said its 50% interest in the North West Natuna PSC (Ande Ande Lumut) oil development in Indonesia is not included in the transaction package, with the intention that Santos exit this asset separately.

RBC is acting as financial adviser and Herbert Smith Freehills is acting as legal adviser to Santos. (*)

Edited by Roffie Kurniawan, email :,

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