Norwest Energy has stripped down and is fit to fight without the burden of debt as it looks to drill out its Lockyer Deep-1 exploration well that is only 15kms north of Strike Resources’ huge West Erregulla gas discovery.
Norwest said it has now discharged a $1m convertible note facility by repaying $750,000 and issuing 100m shares to noteholder, Sundowner International to have it fully acquitted.
Sundowner is an entity associated with Norwest director, David Kennedy.
Norwest is now debt free and has enough cash left in the time to fund its 20 percent working share of the high impact Lockyer Deep-1 gas exploration well.
Lockyer Deep-1 is located in the Northern Perth basin where Norwest has managed to team up with Chris Ellison’s $2.6 billion market capped Mineral Resources to drill the well. Mineral Resources holds an 80 per cent working interest in the well that is also just a few kilometres east of Beach Energy and Mitsui’s giant Waitsia gas field.
Waitsia and Strike’s West Erregulla gas finds have a total gross resource of over 2 TCF of gas that will be potentially saleable to the local market in addition to the more traditional LNG export markets. Beach and Mitsui have also added the recent Beharra Springs Deep gas discovery in the basin where the Kingia Formation flowed at a rate of 46 million standard cubic feet of gas per day, according to Norwest.
Norwest said its Lockyer Deep-1 prospect has the potential to hold up to 1.12 TCF of prospective resources in its own right with the likely well location being only 15kms east of Waitsia and 15km north of West Erregulla.
Back in December last year, the company managed to lock away at $3.25m equity raise and a $795,100 share purchase plan which will assist it to fund its 20 percent share of the upcoming well. The company also completed the sale of its interest in the nearby L14 production licence and received a final consideration of $630,000 in January this year.
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By Matt Birney
