The buyer, Valkyries Petroleum Corp, purchased indirectly a 50% stake in Pechoraneftegas ZAO. The bank underwrote and fully funded the US$30 million, 5-year borrowing base revolving facility and acted as Mandated Lead, Technical Bank and Facility Agent.
The RBL Europe Group arranged a $30 million acquisition financing facility in favour of Valkyries Cyprus Limited, a subsidiary of Canadian Valkyries Petroleum Corp. The latter is controlled and partly owned by the Lundin family, who also controls Lundin Petroleum Corp with whom the bank has had a long standing relationship.
Valkyries Cyprus Ltd purchased 50% of all capital outstanding in a company whose sole assets are 100% of the capital outstanding in Pechoraneftegas ZAO.
This company is involved in exploration and production of oil in the republic of Komi (northeast of Moscow). It holds two producing licenses for the Sotchemyu and Talyu fields and 2 exploration licenses on the Kadzherom and Mutnomateric blocks. Proven reserves amount to 25 million barrels, daily production is currently at 6,000 barrels of oil per day. Infill drillings are expected to increase production to over 10,000 barrels per day. The fields have a direct tie into the main Transneft pipeline and have modern field facilities with over 150,000 barrels of in-field storage.
Total consideration was $39 million. Valkyries Cyprus purchased the shares from Vitol Russia B.V., a subsidiary from the well known trading company. Vitol remains invested in this company through the other 50% of the issued capital. 50% of Valkyries’ share of export volume will be hedged by CIT London. BNP Paribas ZAO Moscow will be the Passport Bank for the deal.