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Australia: TAG Oil to acquire Surat Basin assets from Southern Cross
31 Oct 2016
TAG Oil has announced that its wholly owned Australian subsidiary, Cypress Petroleum, has entered into a definitive asset purchase agreement with Southern Cross to acquire a 100% interest, subject to underlying royalties, in Petroleum Lease 17 ('PL 17') and all related assets, which are located in Australia’s Surat Basin. The Definitive Agreement is subject to certain conditions, including obtaining all necessary government approvals.
TAG will acquire a 100% right, title and interest in PL17 and all related assets for consideration of AUD$2,500,000, payable to Southern Cross as follows:
- AUD$750,000 (less the AUD$40,000 non-refundable deposit already paid) payable in cash on the closing date;
- AUD$500,000 payable in cash on July 20, 2017;
- AUD$500,000 payable, at the sole discretion of Cypress, in cash or satisfied by shares of TAG, on the second anniversary of the closing date; and
- AUD$750,000 payable, at the sole discretion of Cypress, in cash or satisfied by shares of TAG, on the third anniversary of the closing date.
PL 17 Highlights
PL 17 covers 104 km2 (25,700 acres) in the Surat Basin, which is one of Australia’s oldest producing basins, and is approx. 20 km away from the Moonie Oil Field that has produced ~25 mmb to date. Two fields, Bennett and Leichhardt, are located within the permit and have produced intermittingly from the Permian formation since being discovered in the 1960’s, with current production from the Bennett field of approx. 15 b/d of light oil. The Permian oil play is the primary conventional play opportunity within PL 17, and a work program is being designed to enhance the understanding of the reservoir’s properties.
Source: TAG Oil