Interoil completes strategic exit from Argentina

Core Viewpoint - Interoil Exploration and Production ASA has made a strategic decision to exit its conventional operations in Argentina, focusing on optimizing capital allocation and operational efficiency [1][2][7]. Group 1: Strategic Decision - The exit includes interests in Santa Cruz Sur joint operations and the La Brea Block, as well as rights related to the Mata Magallanes Oeste production concession and the Cañadón Ramírez exploration block [1]. - This decision is a result of a comprehensive review of the company's conventional onshore portfolio [2]. Group 2: Market Conditions - The operating and investment environment in Santa Cruz has deteriorated, leading to reduced competitiveness of assets [3]. - Major operators like YPF, Pan American Energy, Petrobras, Sinopec, and Total have also reduced or exited their conventional positions in the region due to increased fiscal and regulatory complexity, labor disruptions, and rising operating costs [3]. Group 3: Transaction Details - The Argentine assets were sold to an Argentine investor for up to USD 1,000,000, payable in ten contingent installments based on production thresholds [5]. - Interoil will receive an Overriding Royalty Interest (ORRI) of 80% on profits from production exceeding 57,000 BOE per month [6]. Group 4: Future Focus - The company aims to concentrate on non-conventional energy assets and select complementary assets to enhance operational efficiency and value creation [7]. - The current industry context is viewed as an appropriate moment for the divestment from mature, conventional assets [7].