PERTH (miningweekly.com) – ASX-listed AWE has struck a deal to divest of its 57.5% interest in the Tui Area oilfields, offshore New Zealand, for $1.5-million to Tamarind Management.
Under the terms of the agreement, Tamarind will acquire all of the outstanding shares of AWE New Zealand and AWE Taranaki, which jointly hold 57.5% of Tui. The transaction is subject to customary consent from the New Zealand government and the Tui joint venture (JV).
AWE CEO and MD David Biggs said on Tuesday that Tui was a landmark project for AWE that cemented its position as an offshore operator.
“Tui has been an excellent production asset generating significant returns for AWE and our JV partners, as well as substantial taxes and royalties for the New Zealand government.
“Following expressions of interest from a number of parties, AWE has opted to sell its interest in Tui to Tamarind because of their ability to maximise value from the late life assets and their experience in decommissioning offshore oil projects.”
Biggs said that with Tamarind’s expertise, and further improvements in the oil price, Tui could potentially continue to operate beyond 2019.
The sale of Tui is expected to generate noncash profits after tax of around A$28-million, subject to purchase price adjustments, and will reduce AWE’s provisions by around 33%.
“The Tui sale is another important step in AWE’s transition from legacy production assets to new growth assets.
“Although we have sold the Tui project, New Zealand remains a component of AWE’s geographic strategy and we continue to evaluate opportunities in New Zealand,” Biggs said.