The amended terms of the Agreement following the announcement on July 24th 2006 are as follows:
--A signature payment of AU$60,000 --A first year administration fee of AU$15,000 --An annual 1% royalty of production --Administrative fees over the life of PELA 132 to be capped at AUŁ125,000
Having been agreed by the State and the governing body ATLA, the Agreement is now being circulated to the nine native title signatories under the Agreement, with the process expected to take up to three weeks. Following this the Agreement will be returned to the State for signature with completion on Meridian's signature, date to be announced, but expected before year end. At that time a formal ceremony with the Australian Minister of Mines and Energy will be held.
As part of the Agreement, Meridian has agreed that if it enters a production situation, the Company will endeavour to support the local community health programs for the Adnyamathana, the local indigenous people who inhabit the Flinders Ranges. Initial support programs will include the establishment of a dialysis clinic within the area.
The Agreement with Meridian is the first petroleum agreement ever signed off by the Adnyamathana people. Commenting on the Agreement, Tony Mason, CEO, Meridian stated, "The Agreement is substantial as it frees the Company to conduct operations on the Dolores prospect, which is located some 40 Km from the Moomba/Adelaide pipeline and which we believe to be a highly commercial prospect.
"We are also commencing detailed analysis of the prospectivity within our overall acreage position in order to identify and develop additional prospects. This will include detailed seismic review and reprocessing of certain areas plus AVO analysis in some cases in order to fully develop the prospect."
PELA 132 covers an area within the Arrowie Basin onshore South Australia and contains the Company's Dolores Prospect, located 40km from the existing Moomba to Adelaide gas pipeline which links the Cooper Basin gas fields to South Australian gas consumers. Meridian holds a 100% interest in the Dolores Prospect and plans to commence operations in Q1 2007 with a test well.
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