Oil Search, Exxon Buy Stakes in Papuan Gulf Exploration Acreage

   By Robb M. Stewart 
 

MELBOURNE, Australia--Exxon Mobil Corp. (XOM) and Oil Search Ltd. (OSH.AU) have agreed to pick up deep-water exploration acreage in the Gulf of Papua from a company controlled by China's Cnooc Ltd. (CEO).

Exxon and Oil Search, partners in a gas-export venture in Papua New Guinea, have agreed to each buy 40% interests in two exploration licenses from Gini Energy Ltd., Oil Search said Monday. Gini will retain a 20% interest in each license.

The licenses cover a combined 24,936 square kilometers in water depths of as much as 2,500 meters.

Peter Botten, managing director of Papua New Guinea-based Oil Search, said a comprehensive study of exploration opportunities in 2015 and 2016 had identified the offshore Gulf of Papua as a area of significant natural-gas potential.

Oil Search in July dropped a takeover bid for Papua New Guinea-focused InterOil Corp. (IOC) after its offer was trumped by a bid worth about US$2.5 billion by Exxon. U.S.-listed InterOil holds six licenses to develop energy projects in Papua New Guinea that cover four million acres, and is part of a Total SA (TOT) led venture which includes Oil Search that has plans to build a liquefied natural gas operation.

Write to Robb M. Stewart at [e-mail]

(END) Dow Jones Newswires

September 12, 2016 03:20 ET (07:20 GMT)

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