Aberdeen-based Warrego Energy has today announced a merger through a reverse takeover with Australian firm Petrel Energy.
The share purchase agreement (SPA) has been approved and signed and will see Petrel acquire all shares of UK firm Warrengo.
Sydney-based Petrel bought all Warrego shares before listing the entire share capital of the enlarged business on the alternative investment market (AIM) in London.
The listing is on the slate for early 2019.
Warrego investors will receive shares equating to about 77% of the capital of the combined business, but prior to the issue of the new shares.
Warrego owns 50% of exploration permit 469, located 140 miles north-east of Perth, Australia, having sold the other 50% to Strike Energy for about £300,000 earlier this year.
Strike took over operator and agreed to cover 100% of the cost of drilling the West Erregulla-2 exploration well in the first half of next year.
CEO and managing director of Petrel, David Casey said: “It’s very rewarding that we have been able to agree final binding terms in such short order on what is definitely a transformative transaction for both Petrel and Warrego.
“I believe this is in large part due to the obvious project and corporate synergies but also important similar philosophical approaches to building what has the potential to be a very large international energy business.
“At the end of the day the scale of the combined portfolio along with the immediacy of next year’s drilling at West Erregulla makes this a very compelling opportunity for all stakeholders and investors alike.
“As good as the West Erregulla opportunity is, I think it’s also important to acknowledge the potential of Tesorillo-1, particularly on the back of Petrel’s AIM listed partner recently increasing its stake in the project to 15% ahead of the proposed drilling of a well towards the end of next year.
“The combined company is in the enviable position of having a portfolio of material assets with very large carried interests in two truly company transforming wells in 2019.”
The reverse takeover by Petrel was announced earlier this week and the signing of a “non-binding term sheet” announced last month.
Warrego was co-founded in 2007 by managing director Dennis Donald, a former Shell engineer, and director Duncan MacNiven, a retired corporate lawyer.
Warrego initially took control of EP469 in 2010.
Warrego managing director Dennis Donald added: “Warrego shares its Australian partner’s enthusiasm for the merging of not only the respective companies’ assets but their skills sets, technical abilities and entrepreneurial approaches.
“We are committed to closing the RTO with Petrel and focusing on our strategy of maximising the international assets of the new listed company.”
