The Novus board said in a statement this morning the offer is unsolicited, "highly conditional and it is immediately clear the offer does not take into account the underlying value of the company." It said not to sell any shares until further details were available.

Novus shares opened at $1.77 on the news, with 3.8 million shares traders by press time.

Medco made the bid this morning though lawyers Allens Arthur Robinson, saying the cash offering was at a premium to recent trading performances, 41% above the volume weighted average Novus share price over the part 12 months.

Novus traded as high as $2.42 in April last year with the market generally being disappointed with rate of exploration success since then.

The conditions set by Medco are run of the mill, as opposed to the Novus board's position, with the Indonesians setting a 90% acceptance level and needing Australian foreign investment approval and several other standard corporate escape holes.

The twenty year old Medco is Indonesia's largest listed oil and gas company with a market capitalisation in excess of US$500 million.

Medco said its intention, if successful, was to broadly maintain Novus' asset portfolio and existing management including senior management. It said it viewed the skills and expertise of Novus employees as a key asset.

Novus said it would be releasing a further statement when it had more information. Medco said the bidder's statement will be dispatched in January.