- Bounty Oil & Gas (BUY) is acquiring a 25 per cent stake in four oil exploration licences in the Carnarvon Basin of Western Australia
- Bounty entered into a binding farm-in agreement with Coastal Oil and Gas, with BUY to spend $6 million on drilling three wells
- Additionally, the ASX-lister can earn another two 25 per cent tranches for additional interests by funding an extra $9 million and $12 million towards drilling
- Bounty also announced on Friday it successfully raised $2.74 million through a placement with 274 million BUY shares to be issued along with attaching options
- BUY shares have resumed trading and are down 6.67 per cent at 1.4 cents per share
Bounty Oil & Gas (BUY) is acquiring a 25 per cent stake in four oil exploration licences in the Carnarvon Basin of Western Australia.
The company has entered into a binding farm-in agreement with Coastal Oil and Gas and agreed to spend $6 million on drilling three exploration wells.
Additionally, the ASX-lister can earn another two 25 per cent tranches for additional interests by funding an extra $9 million and $12 million towards drilling respectively.
Both Bounty and Coastal will operate the drilling program, with the companies describing the play as similar to Santos’ (STO) Dorado, Phoenix South and Roc discoveries.
The two parties expect the drilling to cost between US$20 million and US$30 million (A$26.94 million to A$40.4 million), with expression of interests issued to the rig market.
Commenting on the acquisition, Bounty Oil and Gas CEO Philip Kelso said it was a low-cost, high impact play.
“Bounty will be one of the only juniors in Australia with significant exposure to existing Australian oil production and hydrocarbon provinces with proximity to markets in the east
and the west coast,” Mr Kelso said.
Bounty also announced on Friday it successfully raised $2.74 million through a placement with 274 million BUY shares at 1 cent each to be issued.
For every two new shares issued, an attaching option will be issued with an exercise price of 2.5 cents and expires in November, 2025.
Bounty Oil & Gas came out of a trading halt on Friday, with shares down 6.67 per cent at 1.4 cents each at 12:48 pm AEDT.