The proposed transaction will involve a restructuring of Premier’s equity under a Scheme of Arrangement. This comprises the transfer by Premier to PICL of its 26.67% stake and operatorship in the Yetagun field in Myanmar and 15% of its stake in the Natuna Sea Block A in Indonesia; the cancellation of PICL’s 25% shareholding in Premier at a price of 25p per share; and the payment by PICL to Premier of US$359 million in cash and assumed debt.
Premier and PICL have also agreed in principle with each of the other joint venture partners in the Yetagun Project that they will be offered the option to increase their interests in the joint venture. The discussions, which are ongoing, may result in those partners choosing to increase their stake in the Yetagun joint venture by acquiring part of the interest that Premier proposes to transfer to PICL on the same terms as agreed between PICL and Premier. This would reduce the amount of the Yetagun interest to be acquired by PICL and accordingly reduce both the amount of debt assumed and cash payments made by PICL.
PICL’s involvement in the Yetagun Gas Project in Myanmar commenced when it acquired a 30 per cent interest in the project from Texaco Inc. in 1997. The project consists of a production area within offshore Blocks M-12, M-13 and M-14 located in the Gulf of Martaban. PICL’s partners in this project are Petroleum Authority of Thailand E&P International, Nippon Oil Exploration (Myanmar) Ltd, Myanmar Oil & Gas Enterprise (MOGE) and Premier Petroleum Myanmar Ltd.
The joint venture partners for the Yetagun Gas Project signed a 30-years Gas Sales Agreement with Petroleum Authority of Thailand (PTT) in March 1997 and first gas from Yetagun was delivered to PTT in May 2000 through a cross-border pipeline built as part of the project. The Yetagun field is currently producing around 200 million standard cubic feet of gas per day (mmscfd).
In Indonesia, Premier has a 66.67% equity in the West Natuna Sea Block A. The West Natuna gas project commenced its sale of gas to Singapore through a 650 km trunkline in January 2001. Current production from the Block A is around 130 mmscfd.
Amerada Hess, the alliance partner with whom PETRONAS entered into a strategic shareholding in Premier in 1999, is also exiting its 25% shareholding in Premier. Completion of the restructuring is conditional upon shareholder, court and other approvals.
Issued by
Media Relations & Information Department
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