Banpu Public Company Limited (SET: BANPU) rose more than 5% on Thursday after the company announced the completion of the sale of BKV Chaffee Corners, LLC ), and the divestment of non-operated upstream assets held in BKV Chelsea, LLC at a total value of $130 million.
The share price rose 5.20% to THB5.05 per share during the morning session on July 4, 2024, following the announcement late yesterday on the completion of the sale of BKV Chaffee Corners, LLC (Chaffee), a wholly owned subsidiary of BKV Corporation (BKV), and the divestment of non-operated upstream assets held in BKV Chelsea, LLC (Chelsea). BKV is a 96.38% subsidiary of BANPU.
The detail of transactions are;
On 14 June 2024, BKV completed the sale of Chaffee, in which Chaffee owns a non-operated interest, with 1P reserves of 122 Bcfe (NYMEX case as of December 31st, 2023) in 9,793 net acres and 116 gross (24 net) natural gas wells in Northeast Pennsylvania (NEPA). The transaction value is USD 105.0 million and the adjusted sale price upon transaction consummation is USD 106.7 million (equivalent to THB 3,917 million).
On 28 June 2024, BKV completed the divestment of non-operated upstream assets in Chelsea, with 1P reserves of 35 Bcfe (NYMEX case as of December 31st, 2023), in 6,770 net acres and 214 gross (15 net) natural gas wells, also in NEPA. The transaction value and adjusted sale price is USD 25.0 million. (equivalent to THB 917 million).
Following the consummation of such sales, BKV expects to hold approximately 19,800 net acres in NEPA.
BKV made its initial investment in Chaffee and Chelsea in 2016 and 2017, respectively. The decision to transition away from the non-core non-operated assets is part of BKV’s strategy to optimize the portfolio. The proceeds from the divestments will also allow BKV to scale up the operations in its core operated high-return assets.
According to LSEG consensus, BANPU is expected to record 171 billion baht in revenue and 7,486 million baht in net profit this year. The consensus target price is at THB6.28 per share.
