Court rules in State Gas' favour

THE Tussle between UK-based Dome Petroleum and Aussie junior State Gas over a 20% stake in the Reid’s Dome gas project has been settled, with the Queensland Supreme Court ruling in favour of State Gas.
Court rules in State Gas' favour Court rules in State Gas' favour Court rules in State Gas' favour Court rules in State Gas' favour Court rules in State Gas' favour

 

Operator of the project, State Gas, acquired half of Dome's 40% stake last year, leaving Dome with a 20% interest.

Under the joint venture agreement, State Gas was then allowed to acquire Dome's remaining 20% interest as Dome's stake had fallen below 25%.

Dome, which has had an interest in the lease for the better part of a decade, insists that it only agreed to sell half of its 40% interest on the provision that that it would retain 20%.

The court yesterday found in State Gas' favour and ruled that Dome should execute documents transferring its 20% interest to State Gas.

State Gas will pay A$233,333 to Dome for the interest, however Dome will be required to pay State Gas' legal costs which are expected to be higher than the acquisition price.

"We always thought we had a good case," State Gas chief Lucy Snelling told Energy News following the verdict.

"Dome Petroleum will have to pay our costs on an indemnity basis. The costs haven't been worked out yet and it has to be taxed… we would anticipate that our costs are going to be more than the amount of money than the acquisition price."

When asked whether the company held concerns that the case could continue to drag on if Dome appealed, Snelling said the ruling was "a fairly conclusive decision."

"If they appeal, they'll appeal and we will deal with that if and when they do," she said.

Allens law firm represented State Gas. Dome Petroleum was self-represented but did not appear in court for the judgement.

Justice Helen Bowskill presided over the matter.

Reid's Dome lies in Production License PL231 in South West Queensland.

In late August State Gas unveiled short-term drilling plans for the project, which will include two new wells this quarter.

The first well, Aldinga East-1A, will be in the northern area of the permit, adjacent to the historic Aldinga East-1 well which was drilled in the early 1990s.

The new well is planned to reach 1,200 metres measured depth.

Aldinga East-1A aims to acquire approximately 150m of core samples as well as logging and permeability testing on multiple seams.

If the well is successful it will be completed for production testing.

Following the completion of the well, the rig will be moved to the central area of the permit to drill a second well, Serocold-1, which will also be drilled to 1,200m.

Separate to the drilling program, State Gas said it would begin production testing of the Nyanda-4 well in the final quarter of this year and use data to shape its development plans for the project.

The company will also conduct processing and interpretation of historic raw 2D seismic covering a 123km line within the PL 231 permit, and also begin pipeline route investigations.

State Gas shares were up 3.08% this morning at 67 cents per share.

 

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