Drillsearch has executed an agreement to purchase Magellan Petroleum (Southern) Pty Limited which holds interests in 1 Production License, PPL212 Kiana (30%), 1 Petroleum Retention License over the Udacha discovery (30%) and 1 Petroleum Exploration License PEL107 (20%) from US Company Magellan Petroleum Corporation (MGN). The consideration for the assets is $550,000 which will be financed out of exiting cash reserves. The transaction is expected to be closed this quarter following third party approvals.

Drillsearch Managing Director, Mr Brad Lingo said, "This acquisition is about Drillsearch gaining control over key acreage in the Southwestern Cooper and highlights our belief that the Cooper basin remains a premier onshore basin which by world standards is under explored. It provides additional Oil production at Kiana, increased proven reserves at Udacha and exposure to identified Oil, Wet Gas and Unconventional prospects. With this acquisition Drillsearch has taken greater control over the development of the Western Cooper Wet Gas Project which is moving towards initial commercialisation. We believe simplifying the joint venture arrangements around this project is a key step in moving the project forward.

"Drillsearch is now the largest net acreage holder in the Cooper and is keen to see the Company grow into a significant producer in the Basin through successful drilling. This acquisition neatly fits with our strategy and provides increased exposure to our pipeline of opportunities."

Tags: Drillsearch Energy