Receive our newsletter – data, insights and analysis delivered to you
  1. News
July 4, 2016

MEO Australia to assign 50% stake in WA-454-P permit

MEO Australia has signed an agreement to assign its 50% stake in the WA-454-P exploration permit in the Bonaparte Gulf in offshore northern Australia to Origin Energy Resources.

MEO Australia has signed an agreement to assign its 50% stake in the WA-454-P exploration permit in the Bonaparte Gulf in offshore northern Australia to Origin Energy Resources.

The agreement will include provisions to back-date the assignment to December last year as consideration for MEO’s stake.

The move would allow the company to avoid all expenditure associated with WA-454-P for this year and next in case an exploration well is obligated to be drilled and substantial expenditure incurred.

The company decided to assign its interest after consideration of its strategic focus and allocation of capital to its asset portfolio.

"The company believes this is the most appropriate course of action given current cash reserves and macroeconomic factors."

MEO sought an additional partner for the permit, but could not find any due to the existing depressed farm-out market.

The company looked for additional partner in a bid to minimise its remaining exposure to overall exploration and drilling costs.

Content from our partners
Green investment: What gives Scotland multiple advantages
How the North of Tyne region is leveraging its legacy to define its future
Q&A with Chevron Lubricants’ Paul Sly, global industrial OEM specialist, and Nathan Knotts, global brand technical manager

MEO determined that the WA-454-P permit no longer had a profile that matched its objectives and decided to assign its stake.

In 2013-14, the company received A$5.6m ($4.2m) from Origin from the original farm-out agreement for the permit.

Upon completion of the assignment, Origin will have a 100% interest in the permit.

MEO Australia managing director and CEO Peter Stickland said: "While it is disappointing to walk away from WA-454-P, the company believes this is the most appropriate course of action given current cash reserves and macroeconomic factors.

"The exploration savings from the withdrawal enables MEO to focus on its lower cost and higher priority project, Block 9, onshore Cuba."

Related Companies

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. The top stories of the day delivered to you every weekday. A weekly roundup of the latest news and analysis, sent every Friday. The industry's most comprehensive news and information delivered every month.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU