Sona Petroleum shareholders vote against Stag field acquisition

Shareholders of Malaysian company Sona Petroleum Bhd. have voted against the company’s proposed acquisition of Stag oil field in the Carnarvon basin offshore Western Australia.

An overwhelming 77% of shareholders voted against the special resolution put to an extraordinary general meeting in Kuala Lumpur in which the company’s Australian subsidiary, Sona E&P (Perth) Pty. Ltd., would acquire the producing Stag field in production licence WA-15-L plus pipeline licence WA-6-PL and associated assets from a joint venture of Australian companies for $25 million.

The field is owned 33.33% by Quadrant Energy Ltd., Perth, and 66.66% by Santos Ltd., Adelaide. Quadrant serves as operator.

It would have been Sona’s first upstream petroleum asset.

Sona originally agreed to buy Stag for $50 million in early November last year, but the purchase price was reduced to $25 million following negotiations with the sellers in the first months of 2016 to take into consideration the lower world oil prices.

The field lies 60 km offshore from the town of Dampier and has been on stream since 1998.

It has a production capacity of 5,500 b/d via a fixed platform connected to the Dampier Spirit floating storage and offtake vessel.

Sona had planned to enhance the field’s production, including the drilling of infill wells to accelerate oil recovery.

Remaining reserves are believed to be 13 million bbl of proved oil reserves, 16.2 million bbl of 2P oil reserves, and 24 million bbl of 3P oil reserves.

The surrounding WA-15-L production licence expires in 2018, but can be extended for another 21 years subject to regulatory approvals.

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