AWE owns the Waitsa project in the Perth basin in a joint venture with Origin Energy.
JOHANNESBURG (miningweekly.com) – Shares in Australian oil and gas company AWE rose 10% on Friday after State-owned China Energy Reserve and Chemical Group made a fresh offer of $0.73 a share in cash.
The offer is A$0.02 higher than the proposal two weeks ago, which the AWE board has brushed off as too low.
The AWE board advised that shareholders not take action on the offer and said it would provide a formal recommendation “in time for shareholders to make an informed decision on how to deal with the bid”.
Shares in AWE traded at A$0.73 apiece by late afternoon in Sydney.
Meanwhile, AWE also reported on Friday it had received tenders from five local and international companies for the construction of gas processing facilities for the Waitsa Stage 2 project, in the Perth basin of Western Australia.
Three of the tenders take a traditional engineering procurement construction approach, while two use a build, own, operate model.
MD David Biggs said that AWE had started the evaluation and comparison of the competing bids, which would run through December.
The selection of an optimal delivery method by choosing a tender would also provide the joint venture (JV) with capital cost certainty, which was required for a final investment decision, Biggs added.
The Waitsia Stage 2 project is being advanced by AWE and Origin Energy. The JV partners previously said that, should a final investment decision be taken by the end of 2017, first gas would flow from the project in 2020.
The Stage 2 development could supply 10%, or some 100 TJ/d, of Western Australia’s domestic gas demand for ten years.