Alliance Oil, an independent oil company with operations in Russia and Kazakhstan, has signed a $128 million deal to acquire 100 percent of the shares in the West Siberian gas company SN-Gazdobycha (SNGD), the oil firm said on Tuesday.
“SNGD has two gas licenses in the Tomsk region which facilitate synergies with Alliance Oil’s regional operations,” Alliance Oil said in a statement.
The gas company has proved and probable (2P) gas reserves estimated at 112 million barrels of oil equivalent and proved, probable and possible (3P) reserves at 259 million barrels of oil equivalent.
Gas production is scheduled to commence in the first half of 2013.
“Through the acquisition, the company's total hydrocarbon reserves (3P) will increase by 26 percent from 997 mboe to 1,256 mboe. 2P reserves will increase by 17 percent to 760 mboe (from 648 mboe),” the company said.
Alliance expects to finance the transaction with existing cash and loans.
Alliance produced 17.9 million barrels of oil in 2011, 12 percent more than in 2010.
Alliance Oil Company Ltd was formed from the merger of Russian oil company Alyans and Swedish West Siberian Resources (WSR) in 2008.
It operates the Khabarovsk refinery and controls a network of filling stations in Khabarovsk and Primorye territories, Amur Region and the Jewish Autonomous Region. It produces oil in a number of Russian regions and in Kazakhstan.