New Zealand Oil & Gas Expands Stake in Mereenie Gas Field

Highlights:

• Significant Acquisition: New Zealand Oil & Gas completes the purchase of an additional 25% interest in the Mereenie gas field, increasing its total group stake to 50%.
• Enhanced Reserves: The transaction boosts the group's 2P reserves by 41%, doubling their reserves and production from the Mereenie field.
• Strategic Financing: A$63 million debt facility secured, with an initial drawdown of A$49.5 million, to support the acquisition and future development activities.

Acquisition Completed

New Zealand Oil & Gas has finalized its acquisition of an additional 25% interest in the Mereenie gas field in Australia's Amadeus Basin. The purchase from Macquarie Mereenie, initially announced in February 2024, has met all conditions and is now complete.

Increased Ownership

With this acquisition, New Zealand Oil & Gas now holds a 42.5% stake in the Mereenie project, bringing its total group interest, including Cue Energy Resources' 7.5% stake, to 50%. The other stakeholders are Horizon Oil with 25% and Central Petroleum, the operator, also with 25%.

Financial Details

The acquisition was financed through a NZ$63 million debt facility, with an initial drawdown of NZ$49.5 million. This amount includes the first contingent payment of NZ$5 million due by the end of June 2024. Further contingent and deferred payments totaling NZ$9 million are outstanding, subject to specific conditions.

Reserve and Production Increase

This transaction significantly boosts New Zealand Oil & Gas Group’s reserves and production capabilities. The group's 2P reserves have increased by 41% to 23 million barrels of oil equivalent (mmboe) as of July 1, 2023. This includes developed and undeveloped gas and oil reserves, with the total equivalent reserves doubling post-acquisition.

Strategic Significance

CEO Andrew Jefferies emphasized the strategic importance of this acquisition, highlighting Australia's need for gas to support its energy transition. "Australia needs gas to power its future in our transitioning world," he said. The Mereenie field has been a reliable energy source for decades, and Jefferies sees continued opportunities for its contribution to the energy sector, particularly in providing clean, fast-start firming power.

Future Prospects

The acquisition aligns with the Federal Government’s ‘Future Gas Strategy,’ ensuring a steady supply of gas to meet energy demands. New Zealand Oil & Gas is committed to leveraging this increased capacity to support Australia's energy transition, providing essential heat for mineral processing and maintaining energy stability when renewable sources are insufficient.

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