The oil and gas investment firm said the Sierra deal would likely close during the first half of 2019
Riverstone Energy Ltd (LON:RSE) on Wednesday said it had sold its Mexican Sierra Oil & Gas business to German energy firm Deutsche Erdoel AG (DEA).
The oil and gas investment firm did not disclose the financial terms of the deal but the Financial Times reported that the transaction was worth US$500mln.
Riverstone said the transaction was expected to close during the first half of 2019, following approval by Mexico`s anti-trust and hydrocarbons regulators.
The consideration to be received by REL is composed of upfront cash (net of interim funding) approximately consistent with its current valuation, as well as subsequent earn-outs and adjustments related to the results of upcoming appraisal and exploration activities along with the unitization process of the Zama discovery, Riverstone said in a statement.
The deal will strengthen DEAs position in Mexico and provide it with a sizeable interest in the Zama shallow water discovery, operated by Talos Energy.
Russian billionaire Mikhail Fridmans DEA will gain around 9,400km of exploration acreage in the core of the Sureste basin from the deal.
DEAs CEO Maria Moraeus Hanssen said the acquisition gave it a high-quality exploration and appraisal portfolio in one of the worlds most sought-after offshore basins.
Shares in Riverstone Energy were 0.3% down at 1,192.0p in early afternoon trade.
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