GB Energy has entered a conditional agreement to acquire a portfolio of oil and gas interests from Cooper Energy Limited.

The principal asset within the portfolio is a 30% interest in the producing Worrior oilfield in the Cooper Basin, which has 2P reserves of 2.1 million barrels and which, as present rates, produces over 150,000 barrels of oil per annum.

In addition, GB Energy will acquire a 25% interest in PEL90 and a 30% interest in PEL93 and enter farmout agreements reflecting various percentages in PEL100 (9.165%), PEL110 (10%), and PEL495 (20%), located in the Cooper and Otway Basins.

The up-front transaction consideration comprises $16 million in cash and $0.5 million in GB Energy shares. In the future, a production fee is also payable to COE based on output from the Worrior oilfield and a success fee based on the future reserves calculation for PEL 90.

The transaction is subject to GB Energy completing a capital raising and normal regulatory approvals. As the transaction constitutes a change in the nature and/or scale of the activities of GB Energy, the company is required to re-comply with the admission requirements of Chapters 1 and 2 of the ASX Listing Rules.

This acquisition is in line with the strategy outlined by the GB Energy directors in September 2010 which is to focus on oil and gas assets in Australia with short, medium and longer term prospects. This package of interests provides immediate positive cash flows as well as exciting prospects that have the potential for significant production in the short to medium term.

Tags: GB Energy Limited