Oil Search to enter Alaska

USA

MELBOURNE, November 1, 2017 – Papua New Guinea-focused Oil Search has struck a deal with Armstrong Energy and GMT Exploration to buy stakes in three Alaska oil blocks for USD 400 million, the company announced on Wednesday.

Oil Search is to acquire a total of about 26% from the Nanushuk play where Spain’s Repsol struck crude earlier this year. It also reserved the option to double its interest there for a further USD 450 million.

“With the quality of the assets, the fact that they’re tier 1, and the fact that we’ve gone in very conservatively against what Repsol are saying, I think we can demonstrate to the market that this will be a super deal for Oil Search in the medium term,” CEO Peter Botten told Reuters.

Repsol, which is the joint owner of the play, has estimated that it contains up to 1.2 billion barrels of oil, while Oil Search used a more conservative estimate of 500 million barrels of reserves as the basis for its investment.