By an Online Correspondent
MELBOURNE, Sept. 25 -- Southern Pacific Petroleum NL (SPP) and Central Pacific Minerals NL (CPM) have approved their merger.
SPP will be the surviving firm with 17.3 billion bbl of oil shale resources in central coastal Queensland and the $300 (Aus.) million shale oil demonstration plant at Stuart.
CPM shareholders would get 2.664 SPP shares for each CPM share. The deal is subject to stockholder, court, and Treasury Ministry approvals.
The move will end CPM's cross shareholding in SPP, initiated because of the separate tax treatment during the 1960s for minerals exploration and petroleum projects.
The firms effectively have operated as one company since the early 1970s with identical management and boards. They will ask stockholders to approve a takeover protection mechanism limiting individual investors to 20% of the company for 2 years.
Trans Pacific Petroleum NL, the largest shareholder (12.6% of SPP and 14.4% of CPM), supports the merger.
Meanwhile, Stuart oil production resumed following a 2-month maintenance and capital improvement program. Shale processing rates were 160 tonnes/hr, or 64% of capacity, to minimize odor emissions. Oil production was 2,500 b/d but is due to go to 8,000 b/d in the fourth quarter.
