BPCL acquires stakes in two shale acreages from Australia's Norwest Energy
20 August 2010
Public sector Bharat Petroleum Corporation Limited (BPCL), India's second-biggest state refiner, today said that it has entered into an agreement with Norwest Energy to buy two shale gas acreages in Australia.
BPCL's wholly owned subsidiary, Bharat PetroResources Ltd (BPRL), signed a letter of intent with Perth-based Norwest to acquire a 50 per cent stake in block TP/15 off the Western Australia coast near Port Denison and a 27.8 per cent interest in block EP413, an onshore block near Perth, the company said in a filing with the Bombay Stock Exchange.
BPRL will contribute up to A$10 million towards the drilling and testing programme to evaluate the shale gas potential in EP413 to earn 50 per cent of Norwest's 55.606 per cent interest.
In Norwest's fully-owned TP/15 permit, BPRL will provide up to A$4.5 million of the estimated cost of A$7.5 million of drilling at Red Hill South, including testing and completion, and geological and geophysical studies for a 50 per cent stake in the project.
Norwest will fund up to A$3 million of the total estimated drilling programme and receive re-imbursement of A$500,000 of past costs from BPRL.
BPRL has received the necessary approvals to proceed with the transaction and is currently conducting its formal due diligence process, to be completed within 20 days of the date of this announcement.