The sale of Petroceltic International's stake in an Algerian oil license was received well by investors. Shares of the Irish oil and gas company gained as much as 3.1% after news broke about Algeria's state-owned oil firm Sonatrach buying Petroceltic's 18% stake in the Isarene Production Sharing Contract for the Ain Tsila oil field. The increase was the highest Petroceltic had posted in a month.
Sonatrach would pay USD 20 million for the stake as soon as the deal gets completed. In addition, Petroceltic would also receive a USD 140 million additional development carry payment, as well as two more payments worth USD 10 million after certain milestones have been met.
In a statement, Petroceltic said it would continue to retain 38% of the license once the deal is completed. Sonatrach would hold 43% while the remaining 18% would be held by Italian energy company Enel.
Petroceltic Chief Executive Officer Brian O'Cathain said, "The decision by Sonatrach to exercise its pre-emptive right is a clear indication of the current value and long term upside potential of the Isarene asset."
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