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Mackenzie: Acquisition of Ophir would make Medco a SE Asian upstream powerhouse

JAKARTA (RambuEnergy.com) – Indonesia’s oil and gas company PT Medco Energi Internasional Tbk (IDX:MEDC) has undertaken a bold move by launching a plan to acquire shares of Ophir Energy Plc shares. If successful, the acquisition would make Medco a non-NOC oil and gas power house in Southeast Asia.

On the first day of 2019, Ophir announced it was in talks with Indonesia’s Medco Energi regarding a cash takeover. No amount or other details have yet been released, other than Medco has to make a clear binding offer by the 28th of January if a deal is to proceed.

Ophir’s upstream portfolio includes assets in Thailand, Vietnam, Indonesia, Malaysia, Equatorial Guinea and Tanzania. It also has exploration acreage in Mexico and Bangladesh.

“This is a bold move by Medco, and if successful would create a Southeast Asian upstream powerhouse. Ophir’s current output of 25,000 boe/d combined with Medco’s stated 2018 target of 85,000 boe/d would take it to 110,000 boe/d, of which 101,000 boe/d is in-region,” Research Director Wood Mackenzie Angus Rodger said.

“This would catapult the firm into being the seventh largest non-NOC upstream producer in South-East Asia, above Hess and BP, and just behind Repsol and Total,” Rodger said.

“For Medco a successful acquisition would substantially increase its regional footprint and diversify its mature, Indonesia-heavy portfolio. It would also bulk up its non-Asian exposure by adding growth options in Tanzania and Equatorial Guinea, to add to its existing positions in Libya, Oman, Yemen, Tunisia and the US,” he said.

It would also offer exposure to the global upstream hotspot that is offshore Mexico, where Ophir recently secured participation in three blocks.

Following Ophir’s acquisition of Santos’s Asian assets last year it appeared to have pivoted its portfolio towards Asian growth, given its troubled Fortuna FLNG project in Equatorial Guinea was struggling to attract finance.

Ophir is an independent upstream oil and gas exploration and production company. It is listed on the London Stock Exchange.

Medco is a leading Southeast Asian energy and natural resources company listed on the Jakarta Stock Exchange with a market capitalization of approximately US$ 900 million, operating across three key business segments being Oil & Gas, Power and Mining.

In Oil & Gas, Medco has significant experience in managing complex and mature onshore and offshore assets and moving discovered and challenged resources to production, including LNG.

Medco’s oil and gas assets are based primarily in Indonesia but it is focused on expanding its Southeast Asia presence and adding to its existing international assets in the Middle East and North Africa.

Medco also operates gas, geothermal and hydro power plants in Indonesia through its 88% consolidated interest in Medco Power (12% held by the International Finance Corporation) and has an effective 39% non-consolidated interest in a large Indonesian copper and gold mine. (*)

Edited by Roffie Kurniawan (email: roffie.kurniawan@gmail.com)

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