Oil Basins withdraws from Derby block in Western Australia

Oil Basins (OBL) has decided to effectively withdraw from its position as a 50% Joint Venture Partner in EP487 (Derby Block) located in Western Australia nearly 1,550km from Perth.

Rey Resources (REY) holds the remaining 50% of EP487 through its subsidiary company Rey Lennard Shelf (RLS) along with the operatorship.

OBL has signed a binding asset sale agreement to transfer its 50% interest of EP487 to Rey Derby Block (RDB), a further subsidiary of REY.

Under the agreement, the transfer will carry a nominal value, which will also relieve OBL from funding future obligations at the property.

Accordingly, OBL is relieved from paying approximately $577,000 of existing cash calls made by REY on OBL and an additional $32,000 of legal fees pending from previous disputes.

The transfer will act as the full settlement of all claims between REY and OBL regarding the Derby Block.

The asset sale agreement requires the approval of Foreign Investment Review Board and Western Australian Petroleum Legislation.

After the completion of this transaction, RDB will formally assume the royalty payment obligations of OBL for EP487 owed to OBL’s subsidiary Oil Basins Royalties.

OBL decided to withdraw from this property as it no longer considers it a core asset and is not willing to fund the EP487 work programme that requires raising capital.

OBL has chosen to focus on the continued assessment and conceptual studies for development Offshore Permit VIC / P47 in the Gippsland Basin.

This property hosts the Judith Gas Field and situated approximately 2km from the Kipper Field.