LSE-listed Kistos said on Tuesday it has signed a binding agreement to acquire a 5 percent working interest in Oman’s onshore Block 9 and a 20 percent interest in Blocks 3 and 4 from Mitsui E&P Middle East for $148 million.

The acquisition, effective 1 January 2025 and subject to customary closing adjustments, will be funded from the company’s existing cash reserves, the company said in a stock exchange statement.

Kistos said the assets are expected to add 25.6 million barrels of oil equivalent (mmboe) of 2P [proven and probable] reserves net to the company and deliver additional estimated production of between 9,000 and 10,000 barrels of oil equivalent per day (boepd) net into its 2025 profile. Liquids are expected to account for around 91 percent of the additional output with gas as remainder.

The acquisition - valued at roughly $5.80 per boe of 2P reserves - is expected to be immediately cash-generative.

According to the statement, the transaction marks Kistos’ first entry into the Middle East and broadens its portfolio beyond Europe, adding onshore production and geographical diversification. The company said the acquisition aligns with its strategy of pursuing assets with strong near-term production, development potential and exploration upside.

Block 9, operated by Occidental Petroleum, includes two producing areas. Blocks 3 and 4, operated by CC Energy Development (CCED), comprise seven producing fields across an area of about 29,000 square kilometres in eastern Oman.

All three blocks operate under Oman’s Exploration and Production Sharing Agreement (EPSA) framework.

Andrew Austin, Executive Chairman, said the transaction complements the company’s existing portfolio in the North Sea while providing a platform for long-term growth and enhanced cash flow.

“Effective 1 January 2025, this acquisition will increase our reserves to 50 mmboe and is expected to deliver a material uplift in Kistos' production in 2026 to approximately 20,000 boepd,” he added.

The statement said completion of the acquisition is subject to customary governmental and regulatory approvals and partner consents.

It said further announcements will be provided in due course, upon completion of the acquisition, including any information on completion mechanics and the financial impact of the transaction.

(Editing by Anoop Menon) (anoop.menon@lseg.com)

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