Mosman Oil and Gas has issued a review notice to Origin Energy over the acquisition of the South Taranaki licence in New Zealand after the Brent oil price benchmark dropped below $40 per barrel.
Mosman is acquiring a 70% stake in the licence from Origin but has issued the notice in order to enter good faith negotiations of amendments to the agreement given the fall in world oil prices.
As outlined in the sale purchase agreement, if Brent remains below $40/bbl for 15 consecutive business days, there is the provision for either party to issue a review notice that will lead to good faith negotiations. If there is no agreement within 30 days of a party’s receipt of the review notice, either party has the option to terminate.
The sale purchase agreement also contains provisions for either party to cancel if the New Zealand government consent conditions are not satisfied by January 31.