TIDMRMP
RNS Number : 2898V
Red Emperor Resources NL
02 December 2019
2 December 2019
Red Emperor Resources NL
Option Agreement Signed to Acquire Large Scale Perth Basin Oil
Play, Western Australia
Highlights
-- Binding Letter of Intent entered into in order to secure an
option over an interest in a large offshore block in the shallow
waters of the North Perth Basin, Western Australia
-- Block covers an oil prone trend with trapping geology
directly analogous to the onshore Waitsia gas discovery
-- Low cost option to acquire a 70% working interest with the right to Operate
-- Multiple undrilled traps already mapped, ranging in size up to 50 Km(2)
-- Work is commencing to quantify the recoverable oil resource potential of the block
-- Highgraded traps abut the west side of the Beagle Ridge and
are situated directly in line with charge from the proven Abrolhos
Sub Basin oil "kitchen"
The Board of Red Emperor Resources NL (ASX/AIM: RMP) ("RMP",
"Red Emperor" or the "Company"), the natural resource exploration
company, is pleased to announce that a binding Letter of Intent
("LOI") has been entered into with Pilot Energy Limited (ASX: PGY)
("Pilot Energy") and Key Petroleum Limited (ASX: KEY) ("Key
Petroleum") (together, the Joint Venture ("JV") partners) in order
to secure an option to acquire a 70% operated interest in the
offshore Perth Basin exploration permit, WA-481-P.
Principal Transaction Terms
Pursuant to the terms of the LOI, Red Emperor has agreed to fund
the completion of an existing committed work programme comprising
geological and geophysical studies required to be undertaken within
the final year of the current permit term, up to a capped amount of
A$150,000. Contemporaneous with such work programme being
completed, the existing JV partners, Pilot Energy - 60% interest
and Key Petroleum - 40% interest, in conjunction with Red Emperor,
will formally apply to the National Offshore Petroleum Titles
Administrator (NOPTA) for a renewal of the permit, which currently
expires on 19 February 2020.
On completion of the work programme, currently being managed and
administered by Key Petroleum, and a favourable renewal decision
from NOPTA, Red Emperor will have the exclusive option to acquire a
70% interest in, and the right to operate (subject to any requisite
regulatory approval(s)), WA-481-P, in return for paying the JV
partners collectively A$500,000. Red Emperor has until 15 business
days after NOPTA's approval of the permit renewal application to
exercise such option. A renewal decision is currently expected to
be received in Q1 2020.
The interest to be acquired in the permit will remain subject to
a 10% Net Profits Interest in favour of a former project operator,
Murphy Australia WA-481-P Oil Pty Ltd, to be paid from future
hydrocarbon production from any developed discoveries made on the
permit.
Commenting on the transaction, Red Emperor's Managing Director
Greg Bandy said:
"We are pleased to announce the securing of this option over a
very large exploration area in the Perth Basin, Western Australia,
which reflects the culmination of a significant amount of work by
the Board and its consultants. We believe the WA-481-P block is
predominantly oil prone, relatively shallow, and represents the
western side of a large structural trend that onshore has seen
recent, material discoveries. The Company is well funded to take a
position in this play whilst continuing to identify and evaluate
additional projects that can potentially provide relatively near
term, high impact drilling opportunities."
Additional Background Information
Permit WA-481-P is situated immediately adjacent to the western
side of licences that host the 18 million barrels ("MMBbl") Cliff
Head Oil Field and Xanadu oil discovery. The permit currently
covers approximately 17,457km(2) and a renewal application will be
made for an extension of the exploration period of up to a further
5 years. This will entail relinquishment of 50% of the outboard
part of the permit area which is considered by Red Emperor to be
non-prospective. The firm work commitment for the first three years
of the renewal period is expected to be based on a two-phase
seismic commitment. The JV members would, however, have the right
to accelerate such activity, subject to the requisite permitting
and financing.
Historic exploration activity has focussed on either multi-fault
affected closures on the crest of the Beagle Ridge or steeply
tilted fault blocks that have been shown to preserve limited or no
valid closure over time. This being due to the various phases of
structuring that have affected the Perth Basin.
Accordingly, in the offshore area there have so far been five
modest sized discoveries, mainly oil, with Cliff Head the only
commercial development. There are two gas discoveries on the permit
area, at Frankland, and far to the north, Perseverance that has
clear evidence of a paleo oil column. In essence, it too was an oil
field before late generated gas displaced the oil from the
closure.
Although there are numerous leads and prospects mapped in the
block, Red Emperor's focus will be on the potentially large
closures that are mapped along the western, downthrown side of the
Beagle Ridge, abutting the regional scale, N-S Geraldton Fault
system. These completely undrilled structures are directly
analogous in form to the trapping mechanisms of the onshore Waitsia
Gas Field but with Permian reservoir targets buried to generally
less than 2,500m. The relatively shallow depths should help to
preserve reservoir quality.
For comparative purposes, the currently best-defined structure,
the Doran Prospect that is located immediately adjacent to the west
of the Cliff Head Oil Field may have a closure extending over
35km(2). Cliff Head, that has reserves of 18 MMbbls covers less
than 6km(2).
The prospective trend appears to continue for some 150 km along
a N-S strike and will require further geophysical effort, likely
including 3D seismic, in order for drillable prospects to be
matured.
For further information, please visit
www.redemperorresources.com or contact:
Red Emperor Resources NL +61 8 9212 0102
Greg Bandy
Strand Hanson Limited (Nominated +44 (0) 207 409
Adviser) 3494
James Harris
+44 (0) 203 463
Brandon Hill Capital (UK Broker) 5010
708 Capital Pty Ltd (Australian
Broker) +61 (0) 2 9112 2500
http://www.rns-pdf.londonstockexchange.com/rns/2898V_1-2019-12-2.pdf
Figure 1: Form structure map showing part of the WA-481-P permit
area and equivalent gas prone geology onshore.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
AGRUGGAGPUPBUMP
(END) Dow Jones Newswires
December 02, 2019 02:30 ET (07:30 GMT)
Red Emperor Resources Nl (LSE:RMP)
Historical Stock Chart
From Apr 2024 to May 2024
Red Emperor Resources Nl (LSE:RMP)
Historical Stock Chart
From May 2023 to May 2024