Global law firm K&L Gates acted for Karoon Gas Australia Limited (Karoon) in the sale of its 40% equity interest in Browse Basin exploration permits WA-315-P and WA-398-P to a subsidiary of Origin Energy Limited. The terms of the sale include an upfront cash payment of US$600 million and deferred cash payments of up to US$200 million.
The K&L Gates team advising Karoon was led by Perth energy and resources of counsel Clare Power, who was assisted by partners Eric Fethers and Simon Salter as well as senior associates Riley Kemp and Natalie Collins.
The deal is subject to certain joint venture pre-emption rights and regulatory approval and is expected to complete some time later this year. Upon receipt of proceeds, Karoon will be in a position to advance the Kangaroo Oil discovery in Brazil’s offshore Santos Basin toward development.
Power commented: “This is a great outcome for our client who, as a result of the sale, can pursue high impact oil appraisal and exploration programmes in the Santos, Carnarvon, and Tumbes basins.”
A member of the S&P/ASX 200 Index, Karoon is an international oil and gas exploration company with projects in Australia, Brazil, and Peru. While the company’s core strategy is identifying offshore early stage exploration opportunities, Karoon’s longer-term strategy is to retain residual equity interests in the assets as they go into production.
Ed Munks, Karoon’s Chief Operating Officer, remarked: “We were very impressed with the service Clare and K&L Gates provided on the transaction, showing maturity, flexibility, and good commercial business sense in negotiations.”
This is the second deal on which K&L Gates has acted for Karoon recently, also having advised on the farm-out to Apache Northwest Pty Ltd of a 50% interest in exploration permit WA-482-P in the Carnarvon Basin in Western Australia, which completed on 3 June 2014. The firm also this month acted for B2Gold in its US$570 million friendly merger with Papillon Resources Limited.
