(Sierra Oil & Gas, 4.Dec.2018) — Sierra Oil & Gas signed an agreement that will result in Sierra’s business being integrated with Deutsche Erdoel AG (DEA AG), an international independent exploration and production company headquartered in Germany.
“We are very pleased to have secured an experienced and well capitalized industrial investor that brings valuable technical talent and international know-how into our organization,” said Sierra Oil & Gas CEO Ivan Sandrea.
Upon completion of the transaction, Sierra will be integrated into Deutsche Erdoel México, a fully-owned subsidiary of DEA AG. The resulting portfolio will consist of ten exploration blocks and one onshore production block and is expected to require capital investment of more than $2 billion over the next five years.
With this agreement, DEA AG commits to participate in the drilling of 9 offshore exploration wells and to the development of Zama, a world-class discovery expected to provide a significant contribution to oil production growth in Mexico in the near term.
“Our drilling program for 2019, which has taken years to plan, involves three appraisal wells in Zama and four exploration wells in other blocks, making Sierra one of the most active players in Mexico next year,” said Sandrea.
The transaction is expected to be completed during the first half of 2019, subject to regulatory approvals.