Jadestone Energy PLC on Wednesday said that it had increased its stake in a western Australian oil fields development, one which is ‘fast becoming a key asset’ for the company.
Jadestone is a Singapore-based oil and gas development company focused on the Asia Pacific region.
The company has completed its acquisition of a non-operated 17% working interest in the Cossack, Wanaea, Lambert and Hermes oil fields development, offshore western Australia. This doubles the company’s existing working interest in the CWLH development to 33%.
The seller, Japan Australia LNG Pty Ltd, is a Perth-based hydrocarbon explorer, which operates as a 50:50 joint venture between subsidiaries of Mitsubishi Corp and Mitsui & Co Ltd.
In November, Jadestone announced a sale and purchase agreement with Japan Australia for the CWLH assets, and said that it would make payments of up to $111 million in connection with the acquisition.
This figure included a headline acquisition cost of $9 million and up to $102 million to be paid into the CWLH abandonment trust fund.
Agreed adjustments, reflecting economic benefits from CWLH since the effective date in July 2022, resulted in a net receipt of $6.3 million to Jadestone from the seller.
This $6.3 million and $35.7 million from Jadestone have been paid into the CWLH abandonment trust fund, satisfying the agreed initial $42 million abandonment funding.
The second instalment of $23 million is payable upon approval of the accession documents by the National Offshore Petroleum Titles Administrator, expected in April. The final trust fund instalment is payable on December 31.
Jadestone said that the CWLH fields ‘continue to perform ahead of the company’s expectations’. In 2024 so far, the development has averaged around 13,700 barrels of oil per day, equivalent to around 4,600 barrels per day for Jadestone’s 33% interest following completion.
Chief Executive Officer Paul Blakeley said: ‘We are pleased to increase our interest in the CWLH fields in line with the originally announced terms. The asset continues to outperform our expectations, with the imminent early March 2024 lifting proceeds expected to substantially offset the net cost of the first two abandonment funding instalments.
‘CWLH is fast becoming a key asset for Jadestone. Our increasing ownership and influence will help to realise the full potential of the fields through a life extension beyond 2031 and additional drilling.’
Shares in Jadestone were suspended on Tuesday amid its potential acquisition of Woodside Energy Group Ltd’s offshore Australian oil and gas fields.
Jadestone shares last closed at 23.50 pence each in London on Monday.
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