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NEWS BULLETIN

October 31, 2017 --- Vol. 23, No. 35October 2017

Armstrong brings in Oil Search

Oil Search, based in Papua New Guinea, has bought into Armstrong Energy and GMT Exploration Co.'s interests at Pikka and Horseshoe.

Oil Search said it paid $400 million for a 25.5 percent interest in the Pikka unit and adjacent exploration acreage and 37.5 percent interests in the Horseshoe and block and the Hue shale.

The company has the option, exercisable until June 30, 2019, to purchase all of Armstrong and GMT's remaining interest in the Pikka unit and the Horseshoe Block (25.5 percent and 37.5 percent respectively) as well as an additional 25.5 percent interest in adjacent exploration acreage and 37.5 percent in the Hue shale, for $450 million.

Oil Search said it will carry Armstrong and GMT's share of the 2018-19 appraisal program, estimated at $25 million-$30 million, if the option is not exercised by June 1, 2018, and will assume operatorship on June 1, 2018.

Armstrong is the current Pikka operator; Repsol holds a 49 percent interest.

Oil Search said it has an agreement with Halliburton to provide resources and capability to supplement Oil Search's technical and operating skills on the ground in Alaska.

Oil Search is an oil and gas exploration and development company established in Papua New Guinea in 1929; its main asset is a 29 percent interest in the PNG LNG Project operated by ExxonMobil PNG Ltd. It also holds a 22.8 percent interest in the Papua LNG Project and has interests in and operates all of Papua New Guinea's producing oil fields. The company said it has a strong working relationship with Repsol in Papua New Guinea.

- KRISTEN NELSON

See story in Nov. 5 issue, available online Friday, Nov. 3, at www.PetroleumNews.com

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