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Genel eyes opportunities for USD 2.2 bn cash pile

September 12/2011

(Arabian Oil and Gas) -- Genel Energy, the company to be formed following the completion of Vallares's USD 2.1 billion reverse takeover of Turkey's GeneEnerji, will be looking to spend big on Kurdish assets, according to ex-BP CEO Tony Hayward.

Hayward - who will become CEO of Genel once the takeover is complete - told reporters in Instanbul yesterday that Kurdistan is ripe for mergers and acquisitions activity, and Genel will be looking to apply part of Vallares's USD 2.2 billion cash pile to work.

The bold approach taken by Valares - and the clear appetite for their model from investors - raises questions about whether investors prefer Kurdistan to oil projects in the South, despite the legal and economic uncertainties arising from the fractious relationship between Erbil and Baghdad.

Hayward said one third of the USD 2.2 billion cash will be spent on consolidation, one third on new focus areas and the rest on accelerating the developments of new discoveries. One focus for Genel will be to establish a second exploration and production base in the region, a startegy that may mean that Vallares's disclosed interest in Dana Gas may be continuing.

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