Horizon Oil Farms Into PNG Gas Asset

Eaglewood Energy has executed a farmout agreement with Ketu Petroleum, a wholly owned subsidiary of Horizon Oil, for 20% of Eaglewood's 65% participating interest in PPL 259 in the Western Province of Papua New Guinea, Eaglewood said in a statement.

On completion of the transaction, Eaglewood will continue to own a 45% participating interest in PPL 259 and retain operatorship.

Horizon currently has a 25% participating interest in PPL 259 which, after completion of the farmout, will be increased to 45%.

Further, upon completion of Horizon's sale to Osaka Gas of 40% of its PNG interests its participating interest in PPL 259 will be reduced to 35%.

Accordingly, on completion of the farmout and the Osaka Gas deal, the equity interests in PPL 259 will be Eaglewood 45% (operator), Horizon 35%, Osaka Gas 10% and Mega Fortune International 10%.

Horizon is also the operator of PRL 4 which contains the Stanley discovery adjacent to PPL 259 and PRL 21 (which contains the Elevala, Ketu and Tingu discoveries) adjacent to the Ubuntu-1 gas condensate discovery in PRL-28, in which Eaglewood has a 40% participating interest and is operator.

It is currently expected that the next PPL-259 exploration well will spud during the first half of 2014, although the exact timing of the well is yet to be finalised with Horizon and the other PPL-259 participants.

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