Carnarvon offloads 10% stake in assets offshore WA for $146mn
Sydney-listed Carnarvon Energy has entered into a binding agreement to divest a 10% interest in its Bedout assets offshore Western Australia to OPIC Australia, a wholly owned subsidiary of Taiwan’s CPC Corporation, for $146mn, it said on February 22.
Out of the total cash consideration of $146mn, Carnarvon will receive an upfront payment of $56mn on completion of the transaction, and a further carry of $90mn of its forward expenditure in the Bedout permits once a final investment decision (FID) is taken on the Dorado development.
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The proceeds from the divestment, together with prospective debt finance and Carnarvon’s existing cash, will be used to fund the company’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. Carnarvon retains 20% of the Pavo discovery and follow-up potential in the WA-438-P exploration permit post divestment.
Carnarvon’s Bedout assets consist of the WA-64-L production licence (20%), which contains the Dorado field, and the WA-435-P (20%), WA-436-P (30%), WA-437-P (20%) and WA-438-P (30%) exploration permits. Post the deal, Carnarvon’s interest will drop by 10% across all the assets.
Santos has an 80% interest in Dorado and a 70% interest in Pavo, and operates both fields.
Earlier this month, Santos received regulatory approval for its Dorado oil and gas project. Dorado now has the primary regulatory approvals required to support development.
The Dorado and Pavo fields combined are estimated to contain gross 2C contingent resources of 189mn barrels of liquids and 401 petajoules of gas. Santos’ share is about 147mn barrels and 320 petajoules, respectively. Dorado is an integrated oil and gas project which is planned to be developed in two phases. Phase one development involves the production of oil and condensate through a wellhead platform and an FPSO.