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7 September 2010

Variations to Arrangements with Talisman and Confirmation of Drilling Timetable

New Guinea Energy Limited (NGE/Company) is pleased to announce that it has signed a Heads of Agreement (HOA) with Talisman Niugini Pty Ltd (Talisman) to vary the work programmes for each of PPL 268 and PPL 269 and to confirm the workplan and timetable for these licences.

On 17 March 2010, NGE announced that it had obtained Ministerial approval for the following transfers to Talisman in accordance with the terms of NGE’s Farmout Agreements with Talisman in respect of PPLs 268 and 269:
● Transfer from NGE to Talisman of a 15% interest in PPL 268; and
● Transfer from NGE to Talisman of a 50% interest in PPL 269.

Since that date Talisman has assumed operatorship of PPLs 268 and 269. As part of assuming Operatorship, Talisman has completed a baseline assessment of the exploration potential on both PPL 268 and PPL 269. The blocks contain the major geological structures available in the Western Province of PNG.
● PPL 268 is expected to have “buried hill” type structures similar to structures which have yielded discoveries across the Foreland Basin. Delineating these structures is critical and the Operator is recommending significant investments in seismic to do so.
● PPL 269 has a Foothills “compressional play” trend across the Block offering structures similar to the Pn’yang discovery. Again, the Operator is recommending significant investments in seismic to fully understand this potential. PPL 269 also contains the “Siphon” prospect which is structurally similar to the PPL 268 play type.

Talisman has stated that they consider PPL268 and PPL269 to be prized licences as part of their gas aggregation strategy in the Western Province of PNG. It is believed the licences hold a Mean Prospective Resource of >2 TCF of gas in PPL 268 and >7 TCF of gas in PPL 269.

As a result of this re-assessment and the recommended increases in seismic investment, the HOA was sought to recalibrate activities and timelines across these two permits. The Operator has approached the PNG Government for variations to enable the completion of these seismic programs prior to completing the wells program. However, the HOA is premised upon the dates currently agreed with the Government of PNG. In summary, the programmes are to be varied as follows:

Variations to PPL 269 Programme:

1. An agreed seismic program of US$6 million comprising 92.3km (including 22km on the Siphon project) will be funded by Talisman and completed by 30 November 2010. Contingent seismic programs are planned and will be considered by NGE upon completion of this program.

2. The First Well will be spudded no later than 31 January 2011 or such other date as NGE/Talisman may agree and an arrangement is contemplated which could enable NGE to drill the well.

3. Subject to NGE/Talisman agreeing to drill the Second Well as a joint operation, the Second Well must be spudded no later than 30 June 2011 or such other date as NGE/Talisman may agree. Again, an alternative arrangement designed to enable NGE to drill the well.

Variations to PPL 268 Programme:

1. In return for consideration of US$1.2 million, Talisman will move immediately to a 50% working interest in PPL 268. This will enable Talisman and NGE to evenly share the proposed investments.

2. The PPL 268 seismic program of US$8.3 million is to be completed by 30 November 2010. A contingent program is also proposed and will be considered upon assessment of the initial program.

3. Following completion of the seismic program in 2 above, NGE and Talisman will decide whether to proceed with the First Well. If the parties elect to proceed with the First Well, the First Well must be spudded no later than 28 February 2011 unless agreed otherwise.

Coral Sea Rig

Talisman has agreed to make available to NGE the Coral Sea rig for up to a notional 2 well program in each of NGE’s wholly owned PPLs 265 and 266. Talisman will deliver the rig to the agreed mobilisation point upon receipt of 60 days’ notice from NGE.

Exploration Fund Account
A key element of this HOA is the establishment of an Exploration Fund Account to be established by Talisman for possible investment in NGE prospects or additional interests. The establishment of this Account will enable Talisman to utilise any funds owing by NGE, such as in respect of the PPL 266 seismic program and use of the Coral Sea rig, towards possible future investments in NGE interests.

Mr Michael Arnett, Executive Chairman of NGE said with respect to the execution of this Heads of Agreement, “I welcome Talisman’s enthusiasm and keen interest in PPL268 and PPL269 and look forward to success in the joint exploration of these two licences. That successful outcome will be shared by both our shareholders and the people of Papua New Ginea alike”.
 
>> a summary of the Talisman update... gotta luv the "prized" NGE licenses

Talisman to operate and fund 'prized' New Guinea Energy licences

Published 10:53 AM, 8 Sep 2010

New Guinea Energy Ltd announced on September 7 that it has signed a heads of agreement with Talisman Niugini Pty Ltd to vary the work programs for each of PPL 268 and PPL 269 and to confirm the workplan and timetable for these licences in the Papuan Basin, Papua New Guinea.

Talisman, which has farmed in for a 15% interest in PPL 268 and a 50% interest in PPL 269 and has assumed operatorship, considers the two licences to be prized assets, holding a mean prospective resource of 2 TCF of gas in PPL 268 and 7 TCF of gas in PPL 269.

As a result of this re-assessment and the recommended increases in seismic investment, the agreement was sought to recalibrate activities and timelines across the two permits.

An agreed seismic program for $US6 million ($A6.6 million) comprising 92.3 km will be funded by Talisman and completed by November 30.

Contingent seismic programs are planned and will be considered by New Guinea Energy on completion of the program.

The first well shouldbe spudded by January 31.

For consideration of $US1.2 million Talisman will move to a 50% working interest in PPL 268.

The PPL 268 seismic program of $US8.3 million is to be completed by November 30, 2010.
 
Just some commentary on NGE, after a period of consolidation b/w 10.5 - 12c there's been a move up to 13.5c today - no news yet but perhaps something pending. Maybe the bginning of the seismic program - only 7 weks to get it done.
 
D2 - NGE has been getting some discussions with regard to the Talisman farmout on the Interoil board on yahoo. This is from Malum Nalu's PNG blog:

Tuesday, October 12, 2010
NGE looking at six new wells despite shares fall

By PATRICK TALU

NEW Guinea Energy (NGE) says its shares price fell after the high impact Panakawa well failed to find oil, The National reports.

However, a revised deal with joint venture partner Talisman Energy means three to six exploration wells could be drilled next year.

In a statement, RBS Morgans Ltd analyst Nik Burns said at the current share price, NGE would make an inexpensive acquisition for someone looking to expand its position in PNG.

“We view the NGE shares price as over-sold and rate it as a speculative buy, target price to A$0.21,” Burns said.

The high impact well was drilled in third quarter this year, but failed to intersect oil.

On a positive note, the well did intersect a structure with a viable reservoir, and the well was drilled for under US$11 million.

But this did not protect the shares , which fell to as low as US$0.10.

NGE has renegotiated the terms of the Talisman deal to PPL 268 and 269.

At least three wells are now expected to be spudded by June 30 next year.

In addition to this, NGE is progressing plans to drill up to three additional wells in its other foreland blocks.

“PNG is relatively under-explored and is highly prospective for oil and gas with attractive fiscal terms on offer,” Burns said.

There should be plenty of news flow on drilling activity and results, beginning next January, he said.

http://malumnalu.blogspot.com/2010/10/nge-looking-at-six-new-wells-despite.html
 
Announcement today seems to have given NGE a lift:

New Guinea Energy Ltd (“NGE, Company”) is pleased to announce that it has reached agreement to raise AUD $20,184,559 million by way of private placement of 165,447,205 shares at AUD $0.122 per share to Quantum Partners LP, a private investment fund managed by Soros Fund Management LLC.
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Good volume today and if it breaks through the 14.5 / 15 area could take a run at 18 / 21 (todays trading not on chart almost 10m btw 13.5 and 15)
 

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56gsa said:
Announcement today seems to have given NGE a lift

Good volume today and if it breaks through the 14.5 / 15 area could take a run at 18 / 21 (todays trading not on chart almost 10m btw 13.5 and 15)
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nice find 56... Soros has also invested heavily in IOC's neighboring property. Would luv to see your 18 to 21 prediction come to fruition.

PPS may also be getting a beneficial lift from the press surrounding the PNG conference this week in Sidney, along with the other PNG petroleum & mineral players.
 
maui4marko said:
nice find 56... Soros has also invested heavily in IOC's neighboring property. Would luv to see your 18 to 21 prediction come to fruition.

PPS may also be getting a beneficial lift from the press surrounding the PNG conference this week in Sidney, along with the other PNG petroleum & mineral players.
Click to expand...

Cheers Maui - seems Soros is bullish for Exxon as well which is driving all this excitement in PNG re oil and gas ...

(4 May 2010) Exxon Mobil Corporation ("ExxonMobil") looks like a good bet to outperform the market long-term for investors expecting either higher oil and gas prices, global economic growth, geopolitical crisis, or a long-term decline in the value of the dollar. Apparently, Warren Buffett and George Soros share the belief of higher oil prices in the not too distant future, both Buffett’s and George Soros ‘s SEC Forms 13-F for the quarter ended December 31, 2009,included ExxonMobil.
The positions of Buffett and Soros in Exxon are logical considering that ExxonMobil’s currency is oil and gas and that currency may be a better long-term hedge against depreciation of the U.S. dollar than gold and the hedge pays a dividend.
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Still good volume today but would like to see NGE close above 15 to generate some momentum higher...
 
Nice close today for NGE - at 15 ... not quite the 15.5 but this news may be the catalyst that sees it push through ... anyone seen what happens to shares that list on the OTCQX ??

New Guinea Energy Ltd (“NGE”) is pleased to advise that it has today commenced an American Depositary Receipt (“ADR”) program on OTCQX International under the symbol “NGELY”. Each ADR represents 50 ordinary shares listed on the Australian Securities Exchange under the symbol “NGE”.NGE’s, Executive Chairman, Michael Arnett said “New Guinea Energy’s listing on the OTCQX will provide the Company with more exposure to US investors interested in the Company via a US local market. Recent interest in the Company by a US Fund Manager has proven that there is significant interest in the Company in the US and this listing will facilitate easier access for further US investment. The Board of NGE is very pleased to have started the Company’s ADR program trading today€.
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56gsa said:
Nice close today for NGE - at 15 ... not quite the 15.5 but this news may be the catalyst that sees it push through ... anyone seen what happens to shares that list on the OTCQX ??
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I've been following this thread for the past month or so, and have read back from the first post.
Not yet a share holder, but will buy in early January if conditions are right for my portfolio.

The proposed exposure to the OTC market in the US may not effect the sp, based on the fact that there will, more than likely be very little trading volume.
For comparison, Linc energy would be an example, which is an Australian based company that also trades on a similar basis in the US.
 
56gsa said:
anyone seen what happens to shares that list on the OTCQX ??
Click to expand...

56 - the volume is quite low on this pink sheet ADR, so don't really see it having much of an impact on the PPS. However, I'm glad they listed there bc otherwise those of us in the states wouldn't have access to the shares.
 
dogeatdog said:
The proposed exposure to the OTC market in the US may not effect the sp, based on the fact that there will, more than likely be very little trading volume.
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dog - agree with your assessment. George Soros buying a chunk of the company has a much bigger impact. Plus, with the XOM and IOC LNG projects, the PNG profile is raising and getting more ww exposure.

Just curious - why are you waiting until Jan to enter a position? Is it a timing event with the stock, or having more to do with your purchasing funds?
 
maui4marko said:
dog - agree with your assessment. George Soros buying a chunk of the company has a much bigger impact. Plus, with the XOM and IOC LNG projects, the PNG profile is raising and getting more ww exposure.

Just curious - why are you waiting until Jan to enter a position? Is it a timing event with the stock, or having more to do with your purchasing funds?
Click to expand...

I'm still a little concerned with the current macro economic conditions.
Sovereign debt, the Korean situation, etc.
Plus I prefer not to hold too many positions over the Xmas, and new year periods.
I certainly see PNG as a speculative buy maui4, and MR Soros has a much better track record than I :)
IMHO
 
Finally pushed through the 15.0 cents and closed at 15.5 with sales at 16.0 ... volume on the rise (5m) so looks like it could test the resistance in this area and break through 16...
 
NGE has finally pushed through resistance at 16c on nice volume, from a t/a perspective a bounce off 16 cents up to 18 cents would be the next move. I do like it when a stock converts a previous resistance level into a support level.
 
yeah not sure Maui on what is pushing this one up again but definitely more liquidity again recently and trading volumes have been picking up. The resistance level of 18c will be a challenge but in time it will be taken out as well. I have picked up some more shares with the break of resistance at 16c, but am still down after taking a hit when they didnt find any hydrocarbons with the first well. With Soros onboard and the revised farm out deals with Talisman this stock still offers an opportunity for some nice gains, albeit as a speculative investment as is with most explorers. Time to get drilling.
 
skivvy you're right, time to get drilling! PPS might be warming up due to the upcoming drilling campaign. Talisman is contracted to start drilling on its PPL 268 & 269 farmouts by Jan 31st. Might be good timing to dump in some more mad money LOL.
 

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