Perth alliance formed for global acquisitions
Five Perth-based companies have formed an alliance to collectively acquire oil and gas projects worldwide, and the group said it initially plans to focus on Africa.
MELBOURNE, Mar. 29 -- Five Perth-based companies have formed an alliance to collectively acquire oil and gas projects worldwide, and the group said it initially plans to focus on Africa.
Conceived by Baraka Petroleum Ltd., the alliance also includes Beach Petroleum Ltd. of Adelaide, Arc Energy Ltd., Adelphi Energy Ltd., and Advanced Well Technologies Pty. Ltd., all of Perth.
They signed a memorandum of understanding to pool resources in seeking, evaluating, and acquiring projects.
A spokesman from Baraka said the alliance's creation will allow member companies to jointly acquire projects of a magnitude that probably would not be possible for any of them acting alone. They will be looking at projects in the $20-100 million range.
Baraka's general manager, Mark Fenton, who originated the idea, says it will "allow the companies concerned to punch well above their weight."
He said it also reduces the overall risk and pools complementary resources to ensure the most-efficient use of each company's financial and human resources.
The companies have signed confidentiality and noncompete agreement as well as a joint evaluation agreement.
Unlike a joint venture, no company is obligated to take part in all or any of the opportunities that are brought to the table. The alliance will be flexible, enabling a sharing of costs through the various stages of a project, and companies can elect to discontinue participation at various agreed-on points in a project.
Projects to be contemplated include production, rejuvenation, development, near-field exploration and frontier exploration.
The alliance will start immediately, initially evaluating prospects in Africa where Baraka already is a key player in Mauritania and Mali.