NZ Energy Corp completes TWN acquisitions
Taranaki oil and gas explorer and producer New Zealand Energy Corp has finally closed the deal to buy onshore petroleum licences and processing facilities from Origin Energy in a deal that at times looked capable of failure.
The Vancouver-based company struggled to fund the C$33.5 million acquisition of the Tariki, Waihapa and Ngaere (TWN) licences, originally announced in June last year, and reduced its interest to 50 percent in August when it brought on L&M Energy as a joint venture partner.
Also included in the deal are gas processing facilities at Waihapa.
However, NZEC's latest announcement to the Toronto Stock Exchange says it not only raised funds necessary to close the deal, but had raised C$1.1 million more than its target C$15 million in a non-brokered private placement.
"Of the funds raised, C$8.2 million will be used for financing costs and general working capital while the remainder was used to finance the acquisition," chief executive John Proust said.
"This acquisition more than doubles the company's oil and gas reserves and expands NZEC's presence in New Zealand from both an exploration and infrastructure perspective," said Proust. The company would "move quickly" to develop its plans for the TWN assets.
There would be immediate production and cashflow as well as "significant exploration potential across multiple horizons."
Proved and probable resources added to NZEC's portfolio are calculated at a before tax net present value of C$31.4 million.