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- Oil and gas explorers Cue Energy Resources (CUE) has purchased an interest in three onshore oil and gas fields in the Northern Territory
- For the assets, Cue will pay upfront cash of $8.7 million to Central and will fund Central’s exploration, appraisal and development costs in the fields up to $12 million
- Under the deal, Central will remain the operator of the fields and will manage gas and oil sales on behalf of Cue
- Notably, Cue’s major shareholder, New Zealand Oil & Gas, will also purchase an interest in all three Central assets
- On the market, Cue is up 3.08 per cent and is trading at 6.7 cents per share
Cue Energy Resources (CUE) has agreed to purchase an interest in the Mereenie, Dingo and Palm Valley onshore gas and oil fields in the Northern Territory from Central Petroleum.
The company will purchase a 7.5 per cent interest in the Mereenie, 15 per cent in Palm Valley and 15 per cent in Dingo.
For the assets, Cue will pay upfront cash of $8.7 million to Central and will fund Central’s exploration, appraisal and development costs in the fields up to $12 million.
Under the deal, Central will remain the operator of the fields and will manage gas and oil sales on behalf of Cue.
However, the deal is subject to a number of conditions such as approval from the Foreign Investment Review Board approval.
Cue CEO Matthew Boyall says that the purchase is in line with Cue’s strategy of investment in onshore assets.
“This is a great opportunity for Cue to add producing assets onshore Australia to our portfolio. Acquisition of the interests in the Mereenie, Palm Valley and Dingo fields will provide a fourth revenue stream for Cue, with existing sales under long term contracts into the strong Eastern Australia gas markets,” he said.
“All three fields are operated by a good operator in Central Petroleum and have existing production and near-term development plans which provide multiple pathways to growth,” he added.
Notably, Cue’s major shareholder, New Zealand Oil & Gas, will also purchase an interest in all three Central assets.
On the market, Cue is up 3.08 per cent and is trading at 6.7 cents per share at 11:34 am AEST.
