State Gas cracks on with potential deal on Reid’s Dome despite partner squabble
State Gas has signed on a financial advisor to help it field interest in the Reid’s Dome gas project.
Despite the limited information, shares climbed nearly 10 per cent to an intra-day peak of 90c.
The company (ASX:GAS) says it has appointed Highbury Partnership, an expert in advising oil and gas players on mergers and acquisitions.
Highbury has advised on big deals like Harbour Energy’s proposed $17.9 billion takeover of Australian oil and gas giant Santos and the $634m buyout of AWE Limited by Mitsui.
State Gas said in its quarterly it had received interest from parties considering partnering in the Reid’s Dome project or doing a “company-level” deal.
Director Greg Baynton told Stockhead the company could not comment further on the news, and State Gas would “update the market if and when matters progress”.
Advancing any deal though may face some hurdles, given State Gas is currently caught up in a dispute with its partner in the Reid’s Dome project.
State Gas revealed in early December that it was taking full ownership of the project.
But Dr Bruno Denantes, a director of UK-based Dome Group, said in an email to Stockhead at the time that suggestions State Gas had acquired a 100 per cent interest in the Reid’s Dome project were incorrect and that Dome Petroleum Resources still owned 20 per cent.
State Gas believes it is entitled to full ownership because the reduction of Dome’s stake to 20 per cent took it below the minimum interest stipulated under the joint venture agreement.
The company has been consulting with its lawyers on the matter.
State Gas says it expects to complete its transition to full ownership in the first or second quarter of this year.
Mr Baynton told Stockhead previously that Reid’s Dome could be “the biggest gas field discovery in many years in Queensland” and potentially compares with the Scotia Field owned by Santos.