OPIC Australia, a subsidiary of Taiwan’s national petroleum company CPC, has agreed to acquire a 10% stake in four Bedout subbasin permits, offshore Western Australia, from Carnarvon Energy.
The Bedout assets covered in the deal include the WA-64-L production licence, which comprise the Santos-operated Dorado field, and the WA-435-P, WA-436-P, WA-437-P, and WA-438-P exploration permits.
Under the agreement, Carnarvon will receive a $146m total cash consideration. This includes an upfront payment of $56m upon completion of the transaction and $90m of Carnarvon’s forward expenditure in the permits when a final investment decision (FID) is made for the Dorado development.
In a press statement, Carnarvon said: “The proceeds from the divestment, together with prospective debt finance and Carnarvon’s existing cash, will be used to fund Carnarvon’s share of the Dorado development costs, along with further activities that include exploration in the Bedout Sub-basin and appraisal of the recent Pavo discovery.”
Upon completion of the transaction, Carnarvon will hold a 20% stake in the Pavo discovery and follow-up potential in the WA-438-P exploration permit.
Carnarvon will also hold a pro-forma cash balance of approximately A$178m ($121.6m).
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Carnarvon managing director and CEO Adrian Cook said: “This strong financial position is also expected to support the advancement of low risk growth through the appraisal and development of the nearby Pavo discovery, and pursuing extensive upside potential via exploration opportunities in the Bedout Sub-basin of the highest quality.”
Azure Capital served as transaction adviser for Carnarvon.
Earlier this month, Santos secured approval from the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) to undertake the first phase of the Dorado oil and gas development project.