Pharos Energy has been notified of the signature by the Egyptian Minister of Petroleum and Mineral Resources of the Deeds of Assignment in relation to its Egyptian El Fayum and North Beni Suef Concessions. The Minister’s signature of the Deeds of Assignment, which occurred on 21 March 2022, was the remaining condition to completion of the farm-out and sale of a 55% working interest share and operatorship in each of the Assets to IPR Lake Qarun Petroleum Co ("IPR Lake Qarun"), a wholly owned subsidiary of IPR Energy AG (“IPR”). Accordingly formal completion of the Transaction has now taken place.

The firm consideration payable to the Group at completion is US$5 million, US$2 million of which was received as a deposit on signing of the farm-out agreements relating to the Assets. The Group will also receive, going forward, a disproportionate funding contribution from IPR Lake Qarun of US$38.425 million net to Pharos (to be adjusted for working capital and interim period adjustments from the effective economic date of 1 July 2020). In addition, the Group will be entitled to contingent consideration depending on the average Brent Price each year from 2022 to the end of 2025, capped at a maximum total payment of US$20 million. Pharos will continue to receive its retained 45% working interest share of all revenues, both cost oil and profit oil, throughout.

Jann Brown assumed the role of Chief Executive Officer with effect from 23 March 2022, the date of receipt of the signed Deeds of Assignment from the Minister. Jann is now one of two executive directors of Pharos, alongside Chief Financial Officer Sue Rivett. On the same date, Ed Story and Dr Mike Watts resigned as directors of Pharos, with Ed assuming a new role as President of the Group’s Vietnam business. 

Jann Brown, Chief Executive Officer, commented:
“I am delighted that we have now completed the farm-out transaction with IPR, a key step in reshaping both our portfolio and our financial position, and one which sets Pharos on a path to a new phase of growth in Egypt. IPR’s long track record of success in Egypt, the enhanced field economics agreed with the Egyptian General Petroleum Corporation (“EGPC”) in January, plus the carry over our remaining 45% interest all combine to put us in the right place to deliver the full potential from these assets. We look forward to working closely with IPR, EGPC and our joint Operating Company (Petrosilah) to grow production, cash flow and the value of our Egyptian Assets.

It is truly an exciting time to take over the reins at Pharos. I look forward to continuing to work with Ed to maximise the value from our assets in Vietnam and would like to take this opportunity to thank Mike for his considerable dedication and contribution to Pharos over many years.”

KeyFacts Energy: Pharos Energy Egypt country profile