Magellan Petroleum Corporation has entered into a definitive agreement (the "Sale Deed") to sell the Palm Valley and Dingo gas fields to Central Petroleum Limited (Central) through the sale of its wholly owned subsidiary Magellan Petroleum (N.T.) Pty. Ltd. In exchange, Central will pay to Magellan a total of AUD $35.0 million in cash and Central stock. In addition, Magellan will receive bonuses from Central in the event that future gas sales revenues from Palm Valley exceed certain levels.
Of the AUD $35.0 million in consideration, AUD $20.0 million is payable in cash and AUD $15.0 million is payable in Central stock upon transaction completion ("Completion"). The cash consideration will be paid in two tranches: AUD $15.0 million at Completion and AUD $5.0 million on or before April 15, 2014. Completion is expected to occur no later than March 31, 2014, and is subject to certain customary completion conditions.