History
PetroKazakhstan, a Calgary-based Kazakhstan oil producer, cleared its bonds, fell into a dispute with partner Lukoil, then was bought for US$55.00 a share by CNPC in 2005.
2003-2004: Clearing the debt
The company, then called Hurricane Hydrocarbons Ltd. and later PetroKazakhstan Inc., operated oil assets in Kazakhstan. On January 3, 2003, it announced it would repay all US$208,210,000 of its 12% Senior Notes due 2006 early, on February 3, 2003. The price was US$212,374,200, which is 102% of the principal, plus US$12,492,600 of accrued interest. By the later context, no other debt facilities were known. The record for most of 2003 and 2004 is quiet. On December 29, 2004, production at Turgai Petroleum, the company's 50% joint venture with Lukoil, was temporarily curtailed. The company said Turgai's management had not followed marketing agreements on supplying the domestic market.
2005: Dispute and takeover
On January 18, 2005, the company reported 2004 average production of 151,103 barrels a day, against 151,349 in 2003. That was below its original target of 160,000 to 175,000, which had been cut to 152,000 in September 2004. It reported new oil finds at Aryskum, Kolzhan and Akshabulak. A Turgai court order had restored production on December 29, 2004, but the dispute continued in court, including an action to force PetroKazakhstan Oil Products to refine Turgai's crude. For 2005 it planned 170,000 barrels a day and a US$243 million capital budget.
On August 26, 2005, it announced an arrangement agreement dated August 21 with CNPC International Ltd. A subsidiary would pay US$55.00 in cash per common share. On October 11, Lukoil Overseas Kumkol B.V. said it would oppose the deal at the October 18 Alberta court hearing. It asked the court to wait for a Stockholm arbitration on whether it had a pre-emptive right over the company's Turgai interest. Failing that, it asked for an inspector to hold that interest. The company called the request without merit. The Alberta court approved the arrangement, and the filings do not say what became of Lukoil's opposition.
The acquisition closed on October 26, 2005. Shareholders were to be paid by Computershare Trust Company of Canada within a few days. As of October 27, 2005, PetroKazakhstan was an indirect wholly-owned subsidiary of CNPC and had applied to delist from the NYSE, TSX, London, Frankfurt and Kazakhstan exchanges. The Lukoil pre-emptive right claim and the Turgai court proceedings remained open.
Written from the 7 story beats below (2003 to 27 Oct 2005), which come from the company's own announcements and filings.