nido petroleum keeping mum on raisama takeover

Interesting def something brewing despite company saying its just media speculation..

Nido Petroleum (ASX:NDO) has declined to speculate on speculation that it is planning a takeover bid for fellow Philippines focused explorer Raisama (ASX:RAI).

A takeover of Raisama would complement Nido’s existing portfolio as both companies operate in the offshore Palawan Basin.

Nido would gain a 50% operating interest in Service Contract (SC) 6C, which contains the Cadlao oil field, which has proved and probable reserves of 6.05 million barrels of oil and potentially a 32.3% in SC 6B.

Raisama had previously estimated production of over 11,400 barrels of oil per day from the field, adding that payback of investment capital would happen within the first two months of production and it would generate cash flow of more than A$90 million in its first year.

The company has already secured US$30 million (A$27.8 million) in project debt and another US$35 million in working capital under a facility with BP.

Cost of development is expected to be less than US$30 million

SC6B offers opportunities to tie-back incremental oil production to a development at Cadlao.

A takeover of Raisama will also give Nido exposure to oil and gas exploration assets in Indonesia and New Zealand though the fate of its uranium assets is a lot less certain considering that Raisama itself had earlier this month flagged that its focus was on its oil and gas assets

Nido, which said in its ASX statement that it was in preliminary discussions with a number of third parties, entered the current quarter with A$21.8 million in cash and is working with the Galoc joint venture to start Phase 2 development of the Galoc oil field.