Pan American Energy And Axion Energy To Merge

Published: Sep 11 2017
Deal Summary

Pan American Energy LLC (PAE), an oil and gas company, and Axion Energy Argentina S.A., a downstream energy company, agreed to merge. The new company will be named as Pan American Energy Group (PAEG), which will be operated as integrated energy company in Argentina.

PAE has interests in Argentina’s four main hydrocarbon basins, including operating Cerro Dragon, and interests in the prospective Vaca Muerta shale. PAE also operates the Hokchi block in the shallow water Mexican Gulf of Mexico.

Axion Energy owns and operates the 90,000 barrels of oil a day (bd) Campana refinery in north of Buenos Aires, has over 750 retail sites in Argentina, Uruguay and Paraguay, and has material lubricant and aviation fuels businesses.

PAE is owned by BP Plc (60%) and Bridas Corporation (40%); while Axion Energy is wholly-owned by Bridas. Following the completion of the transaction, PAEG will be equally (50% each) owned by BP and Bridas.

The transaction is expected to be completed in early 2018.

Bob Dudley, chief executive of BP, said, “Supported by the combined skills and expertise of BP and Bridas, this new integrated business will be able to pursue growth and development opportunities in Argentina, Uruguay, Paraguay and Mexico. We see value-enhancing opportunities throughout PAEG’s businesses; from extending the life of mature production and developing new unconventional resources including Vaca Muerta, to growth in retail fuels and lubricants marketing. These fit well with BP’s strategy and will allow us to strengthen and deepen our long-term relationship with Bridas.”

Alejandro Bulgheroni, chairman and president of Bridas, said, “For the past 58 years, we have been investing in the energy sector in Argentina and the region. Efficient investment has been the main factor behind our growth as an oil and gas company. By signing this agreement, a new phase begins for our company, as we integrate our operations with those of our partners.”

Marcos Bulgheroni, director of PAE, said, “This integration agreement ratifies our commitment to investment, employment and the efficient development of resources our region needs.”

Deal history

Update: On November 15, 2017, the merger was approved by The European Commission.

Announced: On September 11, 2017, PAE and Axion Energy agreed to merge.

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