Further to the announcement of April 6 2005, Paladin Resources plc announces that its wholly owned subsidiary, Paladin Expro Limited, has signed a Sale and Purchase Agreement with Nippon Oil Exploration and Production U.K. Limited (NOEPUK), to acquire a 32.59317 per cent operated interest in Licence P.357 (Block 22/19a) in the UK Central North Sea (“the Licence”). The interest to be acquired is part of an interest which NOEPUK has agreed to acquire from one of the other P357 licensees and is being acquired on the same terms pro rata as the acquisition being made by NOEPUK.
The base consideration is £0.5 million in cash, subject to adjustments for working capital as at the effective date of 30 November 2004 and for cash flows in the period between the effective date and completion. In addition to the base consideration, two conditional payments may be made. On governmental approval of a field development plan, a payment of £0.6 million will be made and an additional payment of £0.8 million will be made at the point the project reaches its break-even point.
Completion of the transaction is expected to take place by the end of the second quarter of 2005.
The acquisition is subject to partners’ rights and approvals and to the consent of the UK regulatory authorities.
Block 22/19a contains the Fiddich gas and condensate discovery, which lies approximately 20 km to the south east of the Paladin-operated MonArb Fields.
Following completion of this transaction, partner interests in the Licence would be Paladin Expro Limited (operator) 51.82975 per cent, NOEPUK 38.17025 per cent and Noble Energy (Europe) Limited 10 per cent.
