Metgasco confirms negotiations about future in region

UPDATE: METGASCO has confirmed in a statement this morning it is in negotiations with the government about "the future of its gas operations on the Northern Rivers".

A spokeswoman from the company declined to make any further comment on the progress of the discussion between the two parties.

Alongside discussions about its future, the company also confirmed it was seeking damages over the 2014 suspension of the Rosella drilling program at Bentley.

"Given the commercial-in-confidence nature of the discussions it is not appropriate to make further comment at this stage," the statement concluded.
 

 

INITIAL REPORT: METGASCO chief Peter Henderson has gone quiet as discussions progress over the company's proposed sale of its coal seam gas exploration licences to the NSW Government.

Resources Minister Anthony Roberts has announced a three-month extension of the government's petroleum exploration licence buyback scheme, following criticism of its failure to return Dart Energy's PEL 445 to state ownership before the scheme expired on Wednesday.

"We understand a buyback is a significant decision for titleholders, which is why we have extended the scheme," Mr Roberts said.

When queried about the extension's impact on the Metgasco deal, a spokeswoman said the company "confirms it is in discussion with the NSW Government about the settlement" but said Mr Henderson could not elaborate due to commercial confidentiality.

Mr Henderson has been outspoken in his past criticism of the government's attitude towards the CSG industry.

Metgasco will demand a healthy sum not just for the sale of its exploration licence, but also for damage caused when the State Government illegally suspended the company's operations in May last year.

The Supreme Court reinstated Metgasco's right to resume drilling in April this year, but by that stage Metgasco's shares had already fallen by 40% and the value of its assets had dropped $81 million.

The company has also spent $120 million on exploration but as of Wednesday had a total market capitalisation of only $28.45 million.

PEL 445's future is similarly up in the air, with Lismore MP Thomas George telling the Northern Star on Monday there was "never a timeframe" and the buyback could take years to secure.

The licence covers parts of Lismore, Kyogle and the Richmond and Clarence valleys and shares borders with Metgasco's three exploration areas.

Mr Roberts took pains to list the government's previous buyback achievements, but did not comment on whether Dart Energy or Metgasco's licences would be back in the state's hands within the scheme's extended three-month lifetime.

The scheme has so far resulted in the return of 12 licences to the State Government covering almost three million hectares.

-APN NEWSDESK


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