Santos Limited announced yesterday that it has reached a binding agreement to acquire 100% of the outstanding ordinary shares in Eastern Star Gas (ESG) and has been unanimously recommended by ESG directors, in the absence of a superior proposal.
The announcement also details the subsequent sale of a 20% working level interest in ESG’s permits in the Gunnedah Basin, not including the two permit areas in which Comet Ridge holds interests, to TRUenergy for A$284 million.
ESG is the Coal Seam Gas Operator of Comet Ridge Limited’s Gunnedah Basin permits PEL 427 and PEL 428 where Comet Ridge holds 25% and 40% interests respectively. These permits are located immediately north and west of ESG’s key CSG permit PEL 238, which contains the Narrabri Gas Project and the Wilga Park Gas Fired Power Station.
This transaction represents one of the few remaining consolidation opportunities in the Gunnedah Basin, and expands Santos’ acreage holding into the very north of the basin to include PEL 427 and PEL 428.
“This transaction further confirms that the Gunnedah Basin is maturing into a significant CSG region, and increases the possibility that infrastructure will be developed to take gas to Santos’ LNG project in Gladstone, as well as supplying the NSW market with gas. This is expected to increase the options for Comet Ridge to commercialise its CSG resources in PEL 427 and PEL 428,” Mr McCaul said.
Mr McCaul said this would be a positive outcome for Comet Ridge, which already has a very constructive working relationship with Santos in its ATP 337P Mahalo asset in the Bowen basin, where Santos is Operator.
He said that, in terms of appraising and building gas resources in the NSW permits, he expected PEL 427 and PEL 428 technical work to continue effectively as “business as usual”. However, from a commercialisation point of view, Mr McCaul said the inclusion of ESG’s extensive reserves and resources into the Santos portfolio, gave economies of scale and may ultimately benefit Comet Ridge in the future.
On 7 March 2011, ESG on behalf of the joint venture, announced an initial resource booking for PEL 427 and PEL 428. A seismic acquisition programme is planned for both permits in 2011, with a well scheduled for drilling in the Bellata Trough area of PEL 427 later in the year.
[mappress] Source:Comet Energy , July 19, 2011;