Salamander Energy, the FTSE 250 oil and gas group, has agreed to acquire the share capital of Mitra Energia Bangkanai from AIM-listed group Sound Oil.
Mitra has a five per cent holding in the Bangkanai production sharing contract (PSC), located in Indonesia, boosting its stake in the licence to 85 per cent.
Following the purchase, Salamander's proved reserves will increase by 1.2m barrels of oil equivalent (boe), while contingent resources net to the group will increase by 1.6m boe.
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The consideration for Mitra is comprised of an initial $4.5m cash payment, a further conditional payment of $1.1m cash, and a contingent payment of $1.5m from revenues associated with production from a future discovery in the PSC.
The PSC contains the Kerendan gas field which is undergoing development and is expected to be on stream in 2014.
To date, 122.6bn cubic feet have been committed for sale under a gas sales agreement and a further 160bn cubic feet of resource has been identified in the field for further commercialisation.
The share price rose 0.58% to 173.30p by 09:25.
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