Valiant Petroleum has signed a letter of intent to sign a sale and purchase agreement with Nor Energy AS to acquire Nor Energy (UK) Limited, including a 10.50% interest in Licence P.201, Block 211/22a SE and Licence P.1383, Block 211/23d containing the Causeway Field.

Valiant has agreed to discharge a $3 million loan between Nor UK and Nor at completion of the Nor UK acquisition and to pay a further $2 million deferred, contingent consideration after the Causeway Field has achieved first oil. As part of the transaction Valiant will immediately acquire potential UK tax losses estimated to be $20 million, which it anticipates it will be able to offset against future profit from production across its portfolio. Following completion of the transaction, Valiant will hold a 24.50% stake in the Causeway Field.

The Field Development Plan for Phase I of the Causeway Field development was submitted in December 2008 by the Operator, Antrim Energy Inc. Phase 1 is forecast to initially produce 15,000 bopd, accessing approximately 7.3 million barrels oil (gross) from the East Causeway area. Subsequent phases are anticipated to access additional reserves in the Central and Western areas of the Causeway Field. Approval of the Causeway Field FDP is anticipated during 2009.

Completion of the transaction is subject to various conditions precedent, including completion of the pending transfer of the Causeway Field between Nor and Nor UK and all requisite regulatory consents.

Peter Buchanan, Valiant's CEO, said, "The acquisition of Nor Energy (UK) gives Valiant a more meaningful stake in the Causeway Field and we look forward to continuing to work with the field partners to ensure the timely delivery of this development in our core Northern North Sea area."

Tags: Nor Energy AS, Valiant Petroleum Limited