Norwest Energy has reached agreement with London AIM-listed company Black Rock Oil & Gas plc (BROG) to acquire BROG's 7.5% interest in the permit under which Norwest will be "free carried" for the current estimated cost of drilling and casing the Morangie-1 exploration well, scheduled for October 2002.

Norwest will be responsible for contributing 7.5% of the costs of any production testing in the event of a discovery. The Morangie structure has been interpreted to have the potential to contain up to 250 million barrels of oil in place.

Of the two exploration wells which have been drilled in the WA-226P permit, the Livet-1 well (drilled in 1996) has already encountered an interpreted residual oil column and good quality reservoir rocks. Norwest said the prospectivity of this region has recently been upgraded by the significant oil discoveries at Cliff Head and Hovea to the south, with the Morangie structure being geologically on trend and similar to the Cliff Head oilfield.

The acquisition of the WA226-P interest will be satisfied by the issue to BROG of 12 million shares at an issue price of 10 cents together with 3 million options of the same class as the existing listed options.