Australia’s Origin to raise stake in Otway gas project

Sydney-based Origin Energy, the holder of a 37.5 percent stake in the Australia Pacific LNG project, said it will buy out Benaris’ minority stake in the Otway gas project and exploration ventures for $190 million ahead of the divestment of its Lattice Energy business.

Under the terms of the deal, Benaris’ 29.23 percent interest in the neighbouring T/30P exploration joint venture and VIC/P43 exploration joint venture will also be acquired by the LNG stakeholder.

The acquisitions will increase Lattice Energy’s interest in the Otway gas project joint venture to 95 percent and the exploration joint ventures to 100 percent.

Origin has the right to acquire the assets, although has no obligation to do so if the divestment of Lattice Energy does not proceed. The acquisitions are subject to certain conditions and also Toyota Tsusho pre-emptive rights for the Otway gas project joint venture.

Under a separate agreement, Lattice has agreed to pay Benaris $60 million for 11.89 PJ of reserves to rebalance the share of gas between the parties relating to the historical lifting of production at Otway and to reach agreement on other joint venture matters. The agreement will increase Lattice Energy’s 2P reserves in the Otway JV by 11.89 PJ.

The alignment of interests in the joint venture and the simplification of the ownership structure is consistent with Origin’s preparations to divest Lattice Energy.

These transactions, once completed, will help facilitate the future development of the joint ventures, the company said in its statement.

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