On 28 September 2016 Terra Nova Minerals Inc, through its subsidiary company Terra Nova Energy (Australia) Pty Ltd, entered into an Agreement with Perseville Investing Inc to acquire all of Persevilleâs working interest in Petroleum Exploration Licences PEL 112 and PEL 444. The licences cover a combined area of 2,255 sq km along the western flank of the Cooper-Eromanga Basin.Â  The deal remained pending approval and registration by the South Australian government in 2H 2018.  Perseville currently holds 30.83 % interest in the licences and will transfer all to Terra Nova in return for 40 million Terra Nova shares, valued at approximately AUD 2 million. Under the Agreement, Terra Nova will also gain an additional 1.47% gross overriding royalty interest in the licences.    Background    In July 2015 Terra Nova sold a 5.17% interest in both licenses to Perseville for USD 3 million (valuing the licences at approximately AUD 58 million). With the transfer of 12.83% interest from joint venture partners Australian-Canadian Oil Royalties Ltd and Ely Sakhai to Perseville, on 31 July 2015, Perseville acquired 30.83% interest. Terra Nova remained operator with 20.67% interest and Holloman Energy held 48.5%.  Persevilleâs entry into the permits came after a farm-in deal between Holloman Energy and Terra Nova was terminated. As a result, Holloman was no longer be required to transfer additional working interest to Terra Nova during the exploration programme. Upon farming in during 2012, Terra Nova was assigned a 20% working interest and operatorship in the licences with the right to acquire up to 55% by funding seismic acquisition and a six well drilling programme. Holloman transferred the initial 20% interest in each licence upon Terra Nova providing an upfront deposit for seismic acquisitions (Wingman survey). A further 5.83% interest in each license was issued to Terra Nova upon the completion exploration well Wolfman 1, located in PEL 112. Under the agreement, Terra Nova was required to solely fund dry-hole costs for the first three exploration wells and up to 50% costs for any commercially viable discoveries.  With the farm-in agreements cancelled Terra Nova funded the equivalent of its percentage interest (20.66%) of the total cost for latest exploration well Baikal 1 within PEL 444, which spudded on 3 December 2015. The well was drilled by the âEasternwell Rig 101â land rig and was plugged and abandoned as a dry hole in mid-December 2015. The Baikal 1 was targeting oil within mid-Birkhead channel sands and was drilled as a vertical, slim-hole well. The prospect is the largest of several that were outlined by the Wingman 3D seismic that was undertaken over the permit in June 2013 and later reprocessed.   Terra Nova believes that with the low oil price environment, a higher return to its shareholders would be provided by paying its percentage interest share in the exploration programme and not fully funding the programme (to earn an increased interest) as agreed in the initial farm-in agreement in 2012. However, with the exit of Perseville from the licences, Terra Nova has again increased its interest to over 50% whilst maintaining operatorship and will thus be responsible for higher costs of any future exploration programme.  Terra Nova Energy (Australia) has entered into an Agreement with Perserville Investing to acquire all of Perservilleâs working interest in PEL 112 and PEL 444. Upon completion of the deal, participants in the licences will become: Terra Nova Energy (Australia) Pty Ltd (51.5% + Operator) and Holloman Petroleum Pty Ltd (48.5%).
Terra Nova Minerals Inc, through its subsidiary company Terra Nova Energy (Australia) Pty Ltd, entered into an Agreement with Perseville Investing Inc to acquire all of Persevilleâs working interest in Petroleum Exploration Licences PEL 112 and PEL 444. 