A Virgin Trader

According to several media reports today, Tullow Oil plc (TLW), has now served documents to exercise its pre-emption rights over the assets of Heritage Oil (HOIL) in Ugandan oil fields jointly owned by the two companies.

Tullow had until midnight on Sunday 17th January 2010 to file papers on Heritage’s Ugandan assets, valued at  $1.35bn (£829m).

ENI, who Heritage had already agreed to sell the assets near Lake Albert to back in November were unavailable for comment, according to the Wall Street Journal. Another report said Tullow would match the price offered by ENI for the assets in the deal, although there was no guarantee it would go through. This is a major move by Tullow and would be the biggest deal in the history of the company.

ENI may still seek to block the intervention through the Ugandan government, which will have the final say on the deal.

So far Heritage Oil has declined to comment.

Tags: Heritage Oil, Tullow Oil

It is confirmed, Heritage Oil [HOIL], the UK-listed exploration and production company is to sell its stake in two fields in Uganda’s Lake Albert Rift Basin, to energy giant ENI of Italy.

ENI are to acquire the 50% working interest Heritage holds in two blocks in the Albert Basin, Blocks 1 and 3A, which it shares with Tullow Oil. Under the deal, Heritage will pay a special dividend of between 75 pence and 100 pence per share to investors, according to the Heritage website.

The deal is worth $1.35 billion.

The company also confirm that as a result of entering into the letter of intent (LOI) with Eni, discussions with Genel Energy International Limited (“Genel”) in relation to the proposed acquisition of Genel have been terminated.  The deal is expected to complete in the first quarter of 2010. How this news will affect the share price, remains to be seen.

It is thought Heritage would use the proceeds from the Italian deal to further develop its assets in the Kurdish region of Iraq where the company has a 75% stake in the Miran block in Kurdistan.

The deal also means a windfall for Heritage CEO and founder Tony Buckingham, who holds around 33% of Heritage’s stock.

I bought into Heritage Oil early in the summer only to watch it slide for several months. Luckily I topped up on the way down, ever the optimist.

Virgin

Tags: ENI, Heritage Oil, HOIL

Heritage Oil [HOIL] has confirmed it has a cash position of US$222 million as of 30 September 09, “which covers ongoing work programmes and current plans for 2010 comfortably” according to a statement by the company today. The FTSE 250 oil and gas company also hinted that they hope to reach a formal agreement with Turkey’s Genel Energy on the proposed $6 billion merger before the end of the year. Heritage originally announced the planned merger back in June and had hoped to have the deal finalised by October.

Heritage Oil’s CEO, Tony Buckingham, said:

“Operationally, Heritage is about to embark on its busiest period ever with high-impact multi-well drilling programmes in Kurdistan and Uganda, providing the potential for a significant increase in oil volumes. The previous successful drilling campaign in Block 1, Uganda, has de-risked the prospects for the upcoming programme in Uganda significantly.”

Heritage’s output in Russia soared by 83% in the third quarter to 422 barrels of oil per day.

A note of caution however came from brokers Evolution Securities who commented that “There is nothing particularly new. All it highlights is a window of activity and although it may reignite interest in the story, any significant movement in share price will depend upon whether Heritage can sign the deal with Genel before Christmas”.

After watching the share price take a hammering recently on lack of news as well as delays in the Genal deal, due to leadership changes in Kurdistan, it’s good to hear any news from Heritage.

Virgin

Tags: Heritage Oil, HOIL