Transcription of Finance News Network Interview with IPB Petroleum Limited (ASX:IPB) Managing Director, Brendan BrownDonna Sawyer: Hello I’m Donna Sawyer for the Finance News Network and joining me from IPB Petroleum
(ASX:IPB) is Managing Director, Brendan Brown. Brendan Brown thanks for joining me.
Brendan Brown: Thanks for inviting us Donna.
Donna Sawyer: Let’s start by introducing IPB Petroleum. When and where were you established?
Brendan Brown: We were established in 2009 and our assets are located in the Browse Basin, offshore north-western Australia.
Donna Sawyer: You’ve invited investors to participate in a share offering. What exactly are you offering and how are things progressing ahead of the offer closing date?
Brendan Brown: We’re offering five million shares at 50 cents each to raise a minimum of $2.5 million, and we are taking overs up to an additional $2.5 million. And at this stage, we’re over our minimum subscriptions already.
Donna Sawyer: Where will the funds raised be directed?
Brendan Brown: The funds raised will be directed towards our two existing permits and a potential new permit, which we’ve also bid on in the most recent gazette all round.
Donna Sawyer: Taking a look at the road to trading, are you on track?
Brendan Brown: The flow is proceeding well and we expect to be trading on the ASX around first week of May.
Donna Sawyer: Can you give us an idea of the industry experience and strengths you have within your management team?
Brendan Brown: We’ve got two Executive Directors, myself and Phil Smith. I’ve got an engineering and finance background, Phil is a 30-year geoscientist – a geoscientist with 30 years’ experience. And both Phil and myself are ex BHP Petroleum
(ASX:BHP), and also we spent some time at Nexus Energy
(ASX:NXS) as well. And one of our other Non-Executive Directors is also ex BHP Billiton. And we’ve got two other Non-Executive Directors who both are from a finance and commercial background. So we’ve got a very, very good skill set at the Board level. We’ve also got some senior management that are all ex big company and also having worked in small companies as well.
Donna Sawyer: IPB has established a strategic position along the Browse Basin offshore northwest Australia. What is the scope and potential of your two permit holdings there?
Brendan Brown: Look we believe that the ticket permits that we have are located on what’s called the southern margin. We believe that this holds the potential to be a new oil fairway on the margin of the Browse Basin. Our independent expert - a report it contained within our prospectus, attributed over 500 million barrels of mean prospective recoverable oil resource, in just one of our permits alone. So we believe it’s highly prospective. And if we have success at our upcoming Pryderi well, we believe that it’ll open up that part of the Basin as potentially, a new oil well fairway.
Donna Sawyer: Tell me Brendan, what is your strategy for exploiting your oil and gas assets in the Browse Basin?
Brendan Brown: We’re a conventional oil exploration company and the plan will be to drill the first exploration well. Then most likely in the event of success, drill an appraisal well within the next six to 12 months after drilling that exploration well; book reserves and then proceed towards a predevelopment studies, and then ultimately development.
Donna Sawyer: What plans do you have to increase the size and diversity of your portfolio?
Brendan Brown: Well the permits are so large, at the moment their combined acreage position is over 10,000 square kilometres. And like I said earlier, we’ve been on a third permit and if that is granted to us, we’ll probably hold a position in excess of 13,000 or 14,000 square kilometres, which is quite substantial. The size of those permits offer multiple diversity within those permits alone. So we feel that we have, not only a large position, but also a diversified position amongst the two to three permits that we may have.
Donna Sawyer: IPB has a farmout agreement with CalEnergy Resources. What are the key details of that agreement?
Brendan Brown: The key details are it’s a two stage farm-in. CalEnergy have to drill the well at Pryderi for earning initially a 25 per cent interest in WA-424-P. They then have an option after drilling that well to go to 60 per cent in the permit, by spending additional funds. We estimate the cost of drilling Pryderi, which will be 100 per cent funded by CalEnergy, to be $15 million. And then they would have to spend additional funding on the second stage of the farm-in, approximately $17.5 million to go to 60 per cent in the whole permit. They also have an option to come into our WA-471-P permit at a 25 per cent interest and also an option to participate in the gazettal block that we bid on, at a 25 per cent interest as well.
Donna Sawyer: Finally, aside from the share market float, what are the key goals for IPB Petroleum in 2013?
Brendan Brown: The key goals in 2013 critically are to hopefully, acquire an additional permit, the one that we’ve spoken about that we bid on. Secondly, to drill the Pryderi well and hopefully have a successful oil discovery. Thirdly, look at other opportunities and progress Pryderi in the event of success, look at it drilling an appraisal well. And also look at some of the other prospects and leads we have within our two existing permits, and potentially a third permit.
Donna Sawyer: Brendan Brown, thanks for the introduction to IPB Petroleum.
Brendan Brown: Yeah thanks very much.
Ends
