Oil Search acquires $400-million in Alaskan oil assets


HOUSTON -- Oil Search signed an agreement to acquire a number of oil assets in the Alaska North Slope from privately-owned companies Armstrong Energy LLC and GMT Exploration Company LLC.

The terms of the acquisition include the purchase for $400 million of a 25.5% interest in the Pikka Unit and adjacent exploration acreage, a 37.5% interest in the Horseshoe Block and Hue Shale, together with rights to operatorship of the Pikka Unit. Also included in the terms of the transaction is an option, exercisable at Oil Search’s discretion until June 30, to double its interest in the assets for an additional $450 million.

The acquired oil leases contain approximately 500 MMbbl gross in the Nanushuk and satellite oil fields, with Nanushuk being one of the largest conventional oil fields discovered in the U.S. in more than 30 years.

The acquisition will provide Oil Search with world class oil assets immediately adjacent to existing infrastructure. The assets complement the company’s existing top quartile, high returning PNG gas portfolio and, with significant growth opportunities, have the potential to become, over time, a material business for Oil Search, of a scale equivalent to its PNG assets.

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