White & Case has advised PetroNeft Resources, an oil and gas exploration and production company, on a sale of 50 percent non-operating interest in its License 61 project to Oil India Limited.
License 61 is located in Russia's Western Siberia basin. The value of the transaction was USD 85 million, consisting of a USD 35 million cash payment, USD 45 million of exploration and development expenditure on License 61, and a USD 5 million performance bonus.
PetroNeft, which is listed on the AIM market of the London Stock Exchange and on the Irish Stock Exchange Enterprise Securities Market, will remain as operator of Licence 61 and Oil India will be able to book 50 percent production and reserves from the project. This is the first investment in Russia by Oil India, the second largest Government-owned exploration and production company in India.
"We were very pleased to support our longstanding client PetroNeft on this successful transaction," said White & Case Partner Marc Polonsky. "The commitment of Oil India and the Indian government towards this joint venture with the company reflects the strength of the License 61 project and the opportunities for foreign investors in Russia."
The transaction was announced in mid-April and was approved by shareholders in May; Russian regulatory approvals were received in June. The transaction enables PetroNeft to repay its outstanding loans (from Macquarie Bank and Arawak) and to have significant funds available to invest directly in License 61 over the coming years.
The team was led by Polonsky, supported by London Associates Natalya Bremen and Adnan Chida and Moscow Associates Peter Kotelevtsev, Rimma Izmaylova, Ekaterina Palagina, Ksenia Tyunik, Ekaterina Tulaeva, and Alexey Butusov.