Jadestone buys Australian oil assets from BP

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Jadestone Energy, an independent Singapore-based company, has completed the acquisition of BP’s 16.67% stake in the development of the Cossack, Wanaea, Lambert and Hermes (CWLH) oilfields, aka the North West Shelf oil project, off Western Australia at a total cost of $20 million.

Assets acquired include BP’s entire 16.67% working interest in the CWLH oilfields, subsea infrastructure, floating production, storage and offloading vessel Okha, and total abandonment liabilities estimated at US$82 million.

Ashley Kelty, equity research analyst for Panmure Gordon, said it should be noted that none of CWLH’s partners had anticipated the purchase of Jadestone and that the company understood that Chevon had previously tried to sell its participation.

“We also believe that Woodside may be willing to sell all (or part) of its stake as part of the broader portfolio rationalization program following the acquisition of BHP’s oil and gas assets,” Kelty said.

“Therefore, we believe there is scope for Jadestone to build a larger stake in the region at low cost and grow the asset base significantly.”

“We are very pleased to have had access to this material asset, especially as we see very significant benefits through further investment in the future,” Jadestone chief executive Paul Blakeley said, apparently making echo Kelty’s sentiment.

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The acquisition of BP’s stake adds 5.1 million barrels of proven and probable reserves and 3.9 million barrels of best estimate contingent resources, according to Panmure Gordon.

The other partners in the CWLH oil fields are the operator Woodside Energy with 50% and Chevron and MiMi with 16.67% each.

Production from the CWLH offshore fields averaged 14,196 barrels of oil per day in September, or 2,366 bpd net for the 16.67% stake purchased by Jadestone.

Crude liftings from the CWLH fields are being implemented on an equity basis, with the next lifting attributable to the acquired Jadestone stake of approximately 650,000 barrels scheduled for the middle of this month, with the company expected to realize the profits in december.

Consistent with the initial acquisition announcement, Jadestone paid an initial US$41 million to the North West Shelf Oil Project Abandonment Trust.

Blakeley added that the transaction is typical of the natural transfer of interests in maturing assets from large international oil companies, where materiality thresholds do not compete within their portfolios, to smaller companies willing to invest. for additional reserves and production.

“We strongly believe that the CWLH fields will be a key asset and strategic stepping stone for Jadestone,” he said.

“Over time, we hope to work with the current operator of the North West Shelf oil project [Woodside] and joint venture partners to add value by sharing our expertise in managing mature oil assets,” added Blakeley.

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