Australia-based oil and gas exploration company Rawson Resources Ltd (Rawson) revealed Friday that it has entered into a Share Purchase Agreement (SPA) to increase its interest in Otway Energy (Otway) to 100 percent.
Rawson currently holds 37.5 percent in Otway and Hardie Energy Pty Ltd holds the remaining 62.5 percent interest. Otway currently operates two exploration permits in the Otway Basin in South Australia; petroleum exploration license (PEL)154 and PEL155.
The Otway Basin in South Australia has recently seen an upsurge in exploration activity which is set to continue in 2014. The Otway permits are prospective for both conventional and unconventional exploration. Our recent re-evaluation of existing seismic has confirmed three conventional prospects and identified several new conventional leads. The prospects are defined on 3D seismic and are near drill-ready.
Prospective Resources (Billion cubic feet)
The permits are well located over depositional troughs for unconventional shale gas exploration. Recently, the Casterton Shale was assessed in the neighbouring PEL495 permit with the Sawpit-2 well. Results from core analysis suggest that the shale is generating hydrocarbons and the operators of the block are continuing their unconventional exploration program in the basin.
Details of the Transaction
Rawson will increase its interest in Otway Energy to 100 percent for the consideration of $1.76 million (AUD 2.0 million) and a royalty on future production. The details of the production royalty are being finalized.
Rawson will pay a non-refundable $0.088 million (AUD 0.1 million) deposit on signing the SPA with $1.67 million (AUD 1.9 million) due on completion. The SPA includes standard representations and warranties for each party.
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