Yorktown to sell Egypt-based oil, gas company Merlon International
The New-York-based private equity firm Yorktown Partners is reportedly planning to sell its Egypt-focused oil and gas company Merlon International, Reuters reported on Saturday.
According to the reports, the firm aims to raise up to $400m, and the sale will be run by Citigroup, with expected bids planned to be concluded by July.
Merlon currently operates in Egypt’s Western Desert, in the Fayoum concession, with a production rate of around 7,900 barrels of oil equivalent per day in 2017 from more than 50 wells.
The company has been operating in Egypt since the early 1980s. All the company’s oil and gas assets are currently located in the Fayoum concession area in the Western Desert. In August 2017, a new agreement was signed between Merlon and the Egyptian General Petroleum Corporation for another $6m investments in the Fayoum concession.
The Fayoum concession has estimated recoverable resources of around 125-150m barrels. According to Merlon, 18m barrels were produced in 2017, of which Egypt received 1.6m barrels, in accordance with the terms of the production-sharing contract with the government.
Egypt’s oil and gas sector has been booming in recent years, especially after the discovery of the giant Zohr field, as well as plenty of other offshore gas fields in the Mediterranean.
The Ministry of Petroleum aims to turn Egypt into a major energy hub, through reforms and liberalising the gas sector.