Oilex to Sell Stake in Oz Cooper Basin Assets

Oilex has signed a binding initial agreement with fellow Australian explorer Doriemus for the proposed sale of all of its interests in the Cooper-Eromanga basin, Oilex said January 29.

Subject to the terms of the agreement, Doriemus will acquire 100% of the issued capital of CoEra, a wholly-owned subsidiary of Oilex. At completion, CoEra will own all of Oilex's direct and indirect interests in the Cooper-Eromanga Basin including 79.33% direct interest in two petroleum exploration licences (PEL 112 and PEL 444) (with an option to acquire the remaining 20.66%); and right to acquire 27 petroleum retention licences from Senex (Northern Fairway PRLs).

Post the deal, Doriemus will issue Oilex 28.3mn CHESS depositary interests which is equivalent to the same number of shares. Doriemus will also assume Oilex’s obligations under the Senex agreement to acquire the Northern Fairway PRLs, which includes an A$1.1mn payment upon transfer of ownership from Senex to CoEra. It will also take on payment of future PRL fees and work obligations including well commitments in PEL 112 and PEL 444.

Subject to completion of the transaction, Doriemus proposes to appoint Oilex's chairman, Brad Lingo as the new managing director of Doriemus, Oilex said. In this event, Lingo would also step down as the chairman of Oilex following the appointment of a new Oilex chairman. It is also proposed that Oilex's managing director, Joe Salomon, will be appointed as a director of Doriemus. The independent directors of Oilex are currently conducting a formal process to appoint a new Oilex chairman, the company said.

The deal is subject to the satisfaction of various conditions precedent, including Doriemus obtaining shareholder approvals for the issue of various securities, the completion of a minimum A$3.5mn capital raising by Doriemus, completion of due diligence by each party on the other and execution of definitive transaction documentation between Doriemus and Oilex.