Addax Petroleum to acquire the business of Pan-Ocean Energy

Addax Petroleum Corporation agreed to acquire two subsidiaries of Pan-Ocean Energy Corporation Limited for CDN $1.605 billion in cash and will assume net debt estimated to be CDN$30 million. The subsidiaries are: PanAfrican Energy Corporation (Mauritius) Limited which owns and operates Pan-Ocean Energy’s oil exploration, production and marketing business in Gabon, West Africa and Pan-Ocean Energy UK Ltd. which provides management and operational services to Pan-Ocean Energy and together represent substantially all of the operations of Pan-Ocean Energy.

Commenting on the acquisition, Jean Claude Gandur, President and Chief Executive Officer of Addax Petroleum said, “This is an excellent opportunity to acquire an attractive production and reserves portfolio in Gabon which is a perfect complement to Addax Petroleum’s existing suite of assets and provides an obvious geographic extension to our strategically focused operations in West Africa.”

“These properties offer high quality development opportunities with significant upside potential. Our extensive analysis has revealed the likelihood of substantial near term reserve development which will lead to material production and reserves increases in the near future,” said Jim Pearce, Chief Operating Officer of Addax Petroleum.

These Gabonese assets are currently producing in excess of 10,000 bbls /d of medium to light crude oil and Addax Petroleum expects production to reach approximately 18,000 bbls/d by year end upon completion of a transportation pipeline in the second half of 2006. McDaniel & Associates Consultants independently evaluated oil reserves as of December 31, 2005 at 67.5 million proved plus probable barrels and 121.3 million proved plus probable plus possible barrels. The portfolio also includes significant onshore and offshore exploration potential comprising over 716 thousand net acres (approximately 55% offshore).

Source: www.oilonline.com