Allens has advised Cue Energy Resources Ltd, through its 100 per cent owned subsidiary, Cue Exploration Pty Ltd, on agreements for Beach Energy Limited (Beach), subject to conditions and approvals, to acquire equity in North West Shelf exploration permits, which contain the giant Ironbark gas prospect.
Under the terms of the WA-359-P Farmout Agreement, Beach will acquire 21 per cent equity and free carry Cue for 4 per cent of the cost of drilling the Ironbark-1 exploration well in WA-359-P. Beach will also reimburse Cue $900,000 for past costs.
The agreement is conditional on BP exercising its option to acquire 42.5 per cent equity in the WA-359-P, Cue obtaining an extension to the current permit end date and other customary approvals.
Cue has also granted Beach an option over 7.5 per cent equity in exploration permit WA-409-P, adjoining WA-359-P. If Beach exercise this option, Beach will free carry Cue for 7.5 per cent of the costs of drilling a well in WA-409-P.
Cue will also receive a 10 per cent royalty on all future revenue from Beach's 7.5 per cent equity in the permit.
Cue retains 36.5 per cent uncommitted equity in WA-359-P and continues to talk to companies interested in forming a joint venture together with Beach and BP.
'As a long-standing client of the firm, we are delighted to have been able to assist Cue with this important transaction,' said lead partner Mark McAleer.
Allens legal team
Mark McAleer (Partner), Anne Nguyen (Senior Associate)
Notes for editors.
Allens is a commercial law firm working throughout Australia and Asia. Through its integrated alliance with Linklaters it provides clients access to 40 offices in 28 countries around the world.