PERTH (miningweekly.com) – ASX-listed Tamboran Resources has announced a capital raise of up to A$195-million to fund the A$60-million acquisition of fellow-listed Origin Energy’s Beetaloo basin permits.
Origin on Monday flagged plans to divest of its 77.5% participating interest in a shale gas exploration project with Falcon Oil and Gas Australia, in a deal with Tamboran Resources which was joint venturing with shareholder Bryan Sheffield.
The Beetaloo basin sale was done for an up-front consideration of A$60-million and a royalty on future production over the life-of-field across the Origin interest being acquired. Origin has also executed a gas sale agreement (GSA) for offtake of future gas production.
Tamboran on Tuesday said that the acquisition of Origin’s stake in the Beetaloo basin permits would make Tamboran the largest acreage holder in the region, with 1.9-million net prospective acres, resulting in a 270% increase in its estimate of net 2C contingent gas resource to nearly 1.5-trillion cubic feet.
“The acquisition of Origin’s assets secures the joint venture (JV) a binding GSA with Origin, a leading energy retailer and one of the largest suppliers on the East Coast. Under the GSA, the JV will supply Origin with up to 36.5 PJ per annum (18.3 PJ per annum net to Tamboran) for 10 years, providing the JV with near-term pathway to cash flow,” said Tamobran MD and CEO Joel Riddle.
“Alongside the recently announced memorandum of understanding with Jemena, which allows access to the Northern Gas Pipeline, the Origin GSA is expected to support our ambition to supply low carbon dioxide gas to Australia’s East Coast gas market.”
The acquisition will be funded through an institutional placement to new and existing shareholders, aimed at raising up to A$138-million. Some 657.2-million new shares would be issued at a price of 21c each, including a A$98-million private placement to strategic partners and US cornerstone investors, including a A$30-million equity investment by Sheffield and a A$22-million investment by US drilling solutions provider Helmerich & Payne.
The offer price represents a 22.2% discount to Tamboran’s last closing price on September 14, and an 18.2% discount to the company’s five-day volume weighted average share price.
The placement will be structured in two tranches - the first to raise A$39.2-million, not subject to shareholder approval, while the second tranche will raise the remaining A$98.8-million, subject to shareholder approval at a general meeting scheduled for October 25.
In addition to the share placement, Tamboran will also undertake a share purchase plan, priced at 21c a share, to raise an additional A$3-million.
“Thank you to everyone who has supported Tamboran’s placement, who have made this transformational acquisition possible. This is truly an exciting time for the company as we look to prove up a world-class gas resource,” said Riddle.
“We expect Beetaloo gas will deliver affordable, low carbon dioxide natural gas to Australia’s East Coast gas market and global liquefied natural gas markets over the next decade.”
“Tamboran remains absolutely committed to operating sustainably. We intend to build on the deep relationships with Traditional Owners, pastoralists, other local stakeholders and the Northern Territory government that have been fostered by Origin in the Beetaloo over its substantial, multi-year exploration and appraisal programme. The company is committed to working constructively and transparently in all interactions as we seek to support businesses, jobs and local interests as a member of the community.
“The company’s vision for playing our part in the global transition to a lower carbon economy through the production of low carbon dioxide natural gas resources also remains unchanged. Our objective is to become a net zero carbon emissions gas producer for our equity share of Scope 1 and Scope 2 emissions when the company commences commercial sales of natural gas by integrating renewable energy and carbon offsets into any development.”