Red Sky Energy Acquires PRL 13 (Killanoola Field) in South Australia
ASX-listed Red Sky Energy Ltd. has entered into a binding Sale and Purchase Agreement (SPA) with Beach Energy Ltd. to acquire its 100% operated interest in petroleum retention license PRL 13 in South Australia, which contains the Killanoola oil field.
Under the terms of the SPA, Red Sky (Killanoola) Pty Ltd., a wholly-owned subsidiary of Red Sky, will acquire the license and associated production infrastructure, for a nominal consideration. In addition, Red Sky will be responsible for discharging all obligations and liabilities arising in respect of the assets purchased, including all liabilities relating to decommissioning, abandonment, rehabilitation, remediation, or restoration of those assets.
PRL 13 covers an area of approximately 17.5 sq. km in the Otway basin, located close to the Jacaranda Ridge and Haselgrove gas fields in the Penola Trough in south-eastern South Australia. The Killanoola field was discovered in 1998 with the drilling of Killanoola-1 well, and also includes the Killanoola Southeast-1 well (drilled in 2011). Red Sky intends to initiate re-start planning for the Killanoola-1 well immediately with a focus on resuming oil production as soon as possible, utilizing existing infrastructure and enhanced oil recovery techniques. Other work plans for the permit include a 3D seismic survey, testing of Killanoola Southeast 1 well, and the completion of a field development plan (FDP), scheduled to commence immediately.
“The Killanoola oil field provides clear near-term production for Red Sky. It fits well with our strategy of acquiring near term producing assets with upside potential for reserve growth in one of Australia’s well known onshore areas, the Penola trough. Red Sky has been actively reviewing conventional production opportunities and the current round of divestment activity in the Australian oil and gas sector has created this exciting opportunity for us,” said Red Sky’s Managing Director & CEO, Andrew Knox.
Melbourne-based Red Sky Energy is engaged in the acquisition and development of oil and natural gas assets in the United States and Australia, and currently owns and operates the Gold Nugget Gas Project in Wyoming, and the Innamincka Dome Project in South Australia.
The transaction is subject to customary closing conditions, including regulatory approvals.