In a deal valued at $1.91 billion, China’s Citic Group has purchased the oil assets of Canada’s Nations Energy Company and granted KazMunaiGas, Kazakhstan’s state-owned oil company, an option to a 50% interest in Nations Energy.
Under the agreement, the acquisition will be effected as a purchase of all the shares of Nations Energy pursuant to a court approved arrangement under the Business Corporations Act (Alberta) Canada. As part of the arrangement Nations Energy will transfer its non-Kazakhstan assets to a new Alberta corporation to be owned by existing Nations Energy shareholders who elect to be shareholders in the divested business.
Nations Energy is a corporation formed, in April 1996, under the laws of Alberta, Canada. In May 1997, it successfully negotiated the privatization of JSC Karazhanbasmunai. Since taking over the management and operations of Karazhanbasmunai, Nations Energy has been successful in increasing production from 12,500 bbls a day at the time of privatization to over 50,000 bbls of oil per day today.
In addition to Kazakhstan, Nations Energy has operations in Azerbaijan, Indonesia and California. These operations will be divested to a new company.
