Karoon Gas Australia Ltd (ASX:KAR) has entered a deal to buy Pacific Exploration and Production Corp’s 35% equity stake in the Santos Basin exploration blocks.
This deal follows Pacific’s application for insolvency protection with the Superior Court of Justice in Ontario, Canada in April this year.
Karoon will pay US$20.5 million for this acquisition. It will be made through an upfront cash payment of US$15.5 million, and a deferred contingent payment of US$5 million.
The deferred payment will be made upon first production reaching a minimum of 1 million barrels of oil equivalents from the Santos Basin Blocks.
Karoon reported a net loss of $84 million at 31 December 2015.