Nzog completes farm in agreement for Perth basin permits
New Zealand Oil & Gas (Nzog) has executed a binding agreement with Sydney-listed Triangle Energy to acquire a 25% participating interest in the L7 production license and the EP 437 exploration permit in the Perth basin in Western Australia, the company said on March 21.
Nzog has completed all confirmatory due diligence and will proceed with the deal. As consideration for its 25% interest in L7 and EP 437, Nzog will contribute A$1.9mn towards past expenditure on the recently acquired Bookara 3D seismic data. In addition to the upfront costs, Nzog will fund 50% cost of the first well in L7 and 37.5% of the cost of the second well. With respect to the well to be drilled on EP 437, Nzog will fund 50% of the well costs. After completion of the deal, the permits’ joint ventures will comprise Triangle (50% and operator), Nzog (25%) and Talon Energy (25%).
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Nzog CEO Andrew Jefferies said entry to the Perth basin via farm in to L7 and EP 437 provides low-cost exposure to onshore prospects in an “exciting area”.
The company said it will fund the upfront costs and future farm in costs from current cashflows. Triangle will be appointed operator of the joint venture once established.