Regional oilfield drilling firm Challenger Limited has closed a major partnership deal with a key US  company.

Under the agreement, the US-based Bronco Drilling Company will acquire a significant stake in Challenger Limited in return for a combination of in-kind and cash contributions from Bronco, the company said in a statement.

The Challenger shares acquired by Bronco are all newly-issued and will amount to 25 per cent of Challenger's total issued and outstanding shares on fully diluted basis.

Bronco's in-kind contribution consists of six, different-capacity, land drilling rigs and ancillary equipment. Five of the contributed drilling rigs come from Bronco's existing marketed fleet and one rig is newly constructed by Bronco for the purpose of this transaction.

This major partnership deal between Challenger and Bronco, comes only one year after Venture Capital Bank (VC Bank), a Bahrain-based Islamic investment bank, and its partner, the US private equity firm Global Emerging Markets (GEM), made a sizable private equity investment in the MENA-based oil drilling contractor.

Challenger Limited is a company incorporated and organized under the laws of the Isle of Man, with branch offices in Libya, Egypt, and UAE, and a subsidiary company in Saudi Arabia. Challenger Limited currently owns and operates a premium fleet of 23, different-capacity, land drilling and work-over rigs, which at the moment, are all contracted for operations in Libya. 

Challenger Limited, a prominent provider of contract oil, gas and water land drilling and work-over services, has over 15 years experience in providing services to major and independent oil and gas companies. Over that period of time, Challenger Limited has been operating in; Libya, Egypt, Tanzania, Gabon, and the Republic of Niger. The company has a strong client base, including nearly all state-owned and major oil companies in Libya, as well as International players such as Agip/Eni, Total, Marathon, IPL, Veba and Verenex Energy.

'In view of the vast opportunities of high growth in the MENA region, we along with our partners have decided to go into partnership with one of the best-regarded companies in the oil drilling industry; namely Bronco Drilling Company. This partnership will energize and undoubtedly increase our capacity to expand Challenger activities in both scope and scale. This was based on our full confidence and faith in the investment model and general direction,' said Challenger Limited Chairman Hassan Tatanaki. 

'This transaction shows that the growing co-operation amongst Libya, the U.S., and the Middle East, is creating an attractive investment environment for U.S. and International companies,” said Tatanaki.

'We are very happy that Challenger has attracted foreign investments into Libya, especially from a prominent company in the oil industry like Bronco. We are very proud of this partnership and strongly believe that it will be the starting point for many other foreign investments to be made in the services sector in Libya,' said Tatanaki.

'We have been diligently working on expanding the company Internationally and are very pleased to have reached this agreement with Challenger. This transaction allows us to deploy a portion of our fleet abroad that is not ideally suited for the unconventional drilling which dominates activity in the United States and also provides the company greater exposure to oil. The MENA area has become a region of tremendous growth and opportunity and we are excited about participating in its potential. We are confident that the combination of Bronco and Challenger will create a formidable contractor in the MENA market and beyond,' said Bronco Chief Executive Officer Frank Harrison.

 “We are very pleased to announce this transaction as it confirms VC Bank’s objectives of enhancing the capabilities of regional companies and contribu