Horizon Oil Adds 3.9 Million Barrels Equivalent with Thailand Gas Field Acquisition
Horizon Oil has completed the acquisition of significant stakes in two producing gas fields in Thailand, marking a strategic re-entry into the country and expanding its production footprint. The deal adds low-risk, cash-generative assets with long-term contracts, supporting Horizon’s growth and distribution plans.
- Acquired 7.5% interest in Sinphuhorm and 60% in Nam Phong gas fields
- Assets add approximately 3.9 million barrels of oil equivalent (2P reserves)
- Transaction substantially debt funded with minimal cash reserve impact
- Long-term gas sales agreements with Thailand’s PTT through 2031
- Potential for value growth via life extension, infill drilling, and upgrades
Strategic Re-entry into Thailand
Horizon Oil Limited has officially completed its acquisition of a 7.5% stake in the Sinphuhorm gas field and a 60% stake in the Nam Phong gas field, both located onshore in northeast Thailand. This move marks a significant re-entry into a familiar and strategically important Southeast Asian market, positioning Horizon to leverage low-cost, producing assets with established infrastructure and long-term contracts.
The acquisition was structured to keep Horizon as a non-operator, partnering with Matahio Energy and PTTEP, Thailand’s national oil and gas company, which operate the fields. This partnership ensures operational continuity and access to local expertise, while Horizon benefits from stable production and cash flows.
Enhancing Production and Reserves
The deal adds approximately 3.9 million barrels of oil equivalent in proven and probable reserves, with net production of around 2,100 barrels of oil equivalent per day. Both fields have demonstrated reliable output, with Sinphuhorm producing nearly 9 terajoules per day net to Horizon and Nam Phong contributing about 3.6 terajoules per day.
These assets come with long-term, oil-linked gas sales agreements with PTT, Thailand’s state energy company, extending through to 2031. The gas primarily fuels the EGAT Nam Phong power plant, the largest in northeast Thailand, underscoring the strategic importance and stable demand for these resources.
Financial Structure and Growth Potential
The transaction was substantially debt funded through an amendment to Horizon’s existing Macquarie Bank facility, minimizing the impact on the company’s cash reserves to less than US$0.5 million at completion. This financing approach supports Horizon’s ongoing distribution strategy while enabling immediate production and reserve growth.
Beyond the current production, Horizon sees significant upside potential through life extension projects, infill drilling, facility upgrades, and operational optimizations. Recent investments in booster compressors and well stimulation have already enhanced output, and further development opportunities remain in both fields.
Strategic Implications for Horizon
This acquisition diversifies Horizon’s production base by adding a fourth jurisdiction to its portfolio, complementing existing assets in Australia and New Zealand. It also establishes a platform for further growth in Thailand and the broader Southeast Asian region, leveraging partnerships with established operators and a stable regulatory environment.
With gas demand in Thailand expected to grow amid declining production from other regions, Horizon’s new assets are well positioned to meet ongoing energy needs, providing a reliable and cash-generative foundation for the company’s medium-term growth ambitions.
Bottom Line?
Horizon’s Thailand acquisition strengthens its regional footprint with low-risk assets, setting the stage for growth and sustained cash flow.
Questions in the middle?
- How will Horizon balance debt funding with its distribution commitments going forward?
- What specific development projects will Horizon prioritize to extend field life and boost production?
- How might evolving energy policies in Thailand impact long-term gas demand and contract terms?