NZ OIL & GAS EXECUTES PERTH BASIN FARM IN AGREEMENT

17 January 2023
NEW ZEALAND OIL & GAS EXECUTES PERTH BASIN FARM IN AGREEMENT WITH
TRIANGLE ENERGY

• New Zealand Oil & Gas executes binding Term Sheet with Triangle Energy
• Acquiring a 25% interest in Triangle’s L7 and EP 437 northern Perth Basin permits
• Low upfront entry cost, with 3 exploration wells aimed to be drilled in 2024
• Recently acquired 3D seismic survey covers highly prospective Early Permian gas trend
• Agreement subject to conditions, including final due diligence and regulatory approvals

New Zealand Oil & Gas Limited (NZO or the Company) is pleased to announce that it has
executed a binding Term Sheet with ASX listed energy company, Triangle Energy (Global)
Ltd (Triangle) (ASX: TEG), to farm into a 25% participating interest in Western Australian
onshore Production License L7 (L7) and Exploration Permit EP 437 (EP 437) (together, the
Permits).

After completion the Permits’ joint ventures will comprise Triangle (50% and Operator);
NZO (25%) and, subject to completion of their own farm in agreement, Talon Energy Ltd
(Talon, ASX: TPD: 25%).
As consideration for its 25% interest in L7 and EP 437, NZO will contribute A$1.9 million
towards past expenditure on the recently acquired Bookara 3D seismic data, upon
satisfaction of a number of conditions precedent customary for transactions of this type,
including final due diligence and the execution of formal farm in and joint operating
agreements. The payment is to be made prior to 17th March 2023 (upfront costs).

In addition to the upfront costs, NZO will fund the following exploration activities as part of
its farm in obligations:
In respect of the 1st well on L7 (forecast to be drilled in 2024, at an estimated cost of A
$7.5 million):
• 50% of well costs, up to A$3.75 million; and
• Should total well costs exceed A$7.5 million, NZO to fund 25% of the excess (being
NZO’s working interest)
In respect of the 2nd well drilled on L7 (forecast to be drilled in 2024, at an estimated cost
of A$7.50 million):
• 37.5% of well costs, up to A$2.81 million; and
• Should total well costs exceed A$7.50 million, NZO to fund 25% of the excess (being
NZO’s working interest)

In respect of the well to be drilled on EP 437 (forecast to be drilled in 2024, at an
estimated cost of A$3.0 million)
• 50% of well costs, up to A$1.5 million; and
• Should total well costs exceed A$3 million, NZO to fund 25% of the excess (being NZO’s
working interest)

The exploration wells will target the highly prospective Early Permian-aged reservoirs
identified by the Bookara 3D seismic survey, which are analogous to recent discoveries in
adjacent permits, including Lockyer Deep, Waitsia, West Erregulla and South Erregulla.

The cost of all existing rehabilitation and restoration obligations for L7 and EP 437 are to
be borne exclusively by Triangle.
Chief Executive Andrew Jefferies says entry to the Perth Basin via farm in to L7 and EP
437 provides low-cost exposure to onshore prospects in an exciting area with joint venture
partners the Company knows well.

"We have been looking to make an entry to the Perth Basin for some time. It is a an exciting
province with many large gas discoveries and new production coming on into a growing
market. Our technical team identified L7 and EP 437 as high-potential areas for hosting
significant gas fields and the new 3D seismic is the right tool to de-risk the deeper Early
Permian gas reservoirs. We look forward to working closely with the joint venture to unlock
the potential of these two permits which have the potential to drive meaningful shareholder
value.”

“The exploration opportunities are in Australia, where we have production from our
Mereenie, Palm Valley and Dingo fields, supplying gas into the East Coast gas market
where prices are strong. Triangle are Perth Basin experts whose scale, culture, values, and
technical skillsets are an ideal fit with ours. Like New Zealand Oil & Gas, Triangle values
clean burning locally produced natural gas as a key part of the transition to a low carbon
future in Western Australia; providing energy to the mining operations that will power the
worlds e-future as well as cooking those West Australian lobsters on the barby.”

New Zealand Oil & Gas Chief Executive Andrew Jefferies says the farm in fits the
company’s strategy.
“With this farm in we are continuing to execute our Board’s strategy. It utilises our cash and
balance sheet strength, in one of our target geographies areas and in acreage with an
excellent technical risk reward balance. With exploration success, there would be multiple
development and production pathways to growth.”
NZO will fund the upfront costs and future farm in costs from current cashflows. Triangle
will be appointed Operator of the joint venture once established.
Details of the farm in terms and prospectivity of the permits are provided in the attached
investor presentation.

This announcement was authorised for release by the Managing Director. For further
information, please contact:
New Zealand Oil & Gas Limited
Andrew Jefferies
Managing Director and CEO
+64 4 495 2424
[email protected]
* About Triangle Energy (Global) Ltd
Triangle Energy (Global) Ltd is an ASX listed (ASX:TEG) oil producer and explorer based in Perth, Western
Australia. The Company has a 78.75% interest in, and is Operator of, the producing Cliff Head Oil Field, which
includes the Arrowsmith Stabilisation Plant. Triangle also has a 100% share of the Mt Horner L7 production
licence and a 100% interest in EP 437. Triangle also has an interest in State Gas Ltd (ASX:GAS), which has a
100% operating interest in the Reids Dome production licence (PL 231) in Queensland.

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Announcement PDF