Santos exercises option to up Mahalo project equity
Santos has informed fellow Australian energy company, Comet Ridge, that it would acquire the latter’s 12.86% option stake in the Mahalo gas project in Queensland, Comet Ridge said on September 26.
Last year, Comet Ridge acquired a 30% interest in the Mahalo gas project from Australian Pacific LNG (APLNG), taking its stake to 70%. The deal was completed in June this year. Comet Ridge paid A$12mn ($7.82mn) in cash to APLNG on the completion of the deal, and a further A$8mn will be paid in deferred tranches. Comet Ridge also executed a funding and option agreement with the Mahalo joint venture partner, Santos.
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Comet Ridge is funding the consideration and associated costs via a A$13.15mn loan from Santos, which holds a 30% interest in the project. Following the completion of the Comet Ridge-APLNG deal, Santos had a six-month option to acquire an additional 12.86% interest in Mahalo from Comet Ridge.
“Comet Ridge Limited advises that it has received notice from Santos QNT Pty Ltd to purchase the 12.86% option interest in the Mahalo gas project from Comet Ridge. Santos has exercised this option prior to the option expiry date of 28 December 2022,” the company said in a statement.
Comet Ridge’s interest in Mahalo will drop to 57.14% from 70% 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.