Oil Search Ltd plans to undertake an active appraisal ahead of a planned final investment decision in late 2019 on the proposed acquisition of a 25.5 percent interest in the Pikka Unit in the Alaska North Slope.
The proposed acquisition is made on the basis that the Pikka Unit and adjacent acreage and 37.5 percent in the Horseshoe Block contains a discovered resource of 500 million barrels, compared to an estimate of 1.2 billion barrels by the existing joint venture partners.
The proposed acquisition is worth US$400 million (K1.2 billion), with the option for OSL to double its interests by mid-2019 for an additional US$450 million (K1.4 billion).
Meanwhile, OSL takes over operatorship in the first quarter of 2018 and will undertake active appraisal.
“The acquisition, which is expected to be completed within the next month, represents an entry into Tier 1 assets that have potential to generate material growth with high returns and complements the company’s existing high quality gas assets in PNG,” says OSL CEO, Peter Botten.