Pure Energy boosts reserves, backs BG bid

CSM firm and takeover target Pure Energy, Brisbane, has upgraded its 2P certified gas reserves for Cameron field in Queensland Permit ATP852P to 485 bcf from 366 bcf.

Feb. 19, 2009

2 min read

Rick Wilkinson
OGJ Correspondent

MELBOURNE, Feb. 19 -- Brisbane-based coal seam methane company and takeover target, Pure Energy Resources Ltd., has upgraded its 2P certified gas reserves for Cameron field in Queensland Permit ATP852P to 522 petajoules (485.46 bcf) from 394 petajoules (366.42 bcf).

The 32% increase comes in the midst of a takeover battle for the company being waged by fellow Brisbane company Arrow Energy Ltd. and the UK-based major, BG Group.

Pure says the new reserve figures are based on recent drilling and test results from pilot wells in Cameron field (Cameron 28 and 29) which are the final two pilot wells in the current phase of the certification program.

When put with its Bowen basin assets in ATP806P, Pure's total certified reserves and contingent resources total 522 petajoules in 2P reserves, 2,510 petajoules (2.33 tcf) in 3P reserves and 5,649 petajoules (5.254 tcf) in contingent resources.

In the meantime, Pure's board has recommended that shareholders accept the latest BG offer of $8/share (Aust.) for the company, provided no better offer arrives within the next 7 days.

It seems likely, in light of Pure's reserves boost, that Arrow Energy will make another counter bid. Quite possibly BG will then come in higher again as there is much at stake in the race for the two companies to secure sufficient gas reserves to support their respective export LNG plant proposals for the Gladstone area in central coastal Queensland.