Comet Ridge close to completing Mahalo deal
Sydney-listed Comet Ridge is close to completing the acquisition of 30% interest in the Mahalo gas project in Queensland from Australian Pacific LNG (APLNG). The company June 14 said the acquisition agreement is now unconditional.
The company will pay A$12mn ($8.36mn) in cash to APLNG on the completion of the deal, and a further A$8mn post-completion in deferred tranches. Comet Ridge has also executed a funding and option agreement with the Mahalo joint venture partner, Santos.
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“Completion of the remaining A$11mn of the total A$12mn upfront consideration will occur by 28 June 2022. Upon completion of the acquisition, Comet Ridge will increase its existing 40% interest in Mahalo to 70%,” it said in a statement.
Comet Ridge will fund the consideration and associated costs via a A$13.15mn loan from Santos, the remaining Mahalo joint venture participant, which holds a 30% interest.
Following completion of the acquisition, Santos has a six-month option to acquire an additional 12.86% interest in Mahalo from Comet Ridge. If Santos exercises this option, Comet Ridge’s interest in Mahalo will drop to 57.14% and the loan repayable to Santos will decrease to A$8mn. Santos will move up to a 42.86% interest in Mahalo upon exercise of the option.
“It’s pleasing to have finally met all conditions precedent, to have significantly increased our equity in the project and to now be looking to the future with Santos to take Mahalo to FID and move into producing reliable, competitive energy for Australia’s east coast gas market," Comet Ridge managing director, Tor McCaul, said.