JOHN DURIE
Central Petroleum’s Richard Cottee poised to achieve potential
Central Petroleum boss Richard Cottee at a gas facility outside Alice Springs.
Macquarie Bank has put its foot on a gas deposit to allow it to play the futures market down the track with today’s deal to buy Central Petroleum for $86 million.
The deal, which is subject to shareholder approval, includes a contingent value right which is based on present exploration securing the hoped-for 600 billion cubic feet of gas.
If this exploration is successful Central Petroleum will have achieved the potential Richard Cottee had hoped for when he moved into Central three years ago.
Macquarie is a big player in the US gas futures market and that seems to be its game with this deal, as you need physical gas to deliver on a future bet at a time of shortage.
It also owns a 50 per cent stake in the Mereenie Basin which is operated by Central Petroleum,
If all works to plan then Macquarie will have landed cheap gas.
For Cottee, Macquarie represents the financial backer he was looking for when he went looking for new equity last year but failed to find much support.
Now he has the support, but under the full control of Macquarie.
He owns at least three million shares which are worth around $600,000.
Cottee says he has yet to talk with Macquarie to settle his future.
The issue will come down to the right financial deal and whether he thinks he can add value.
Macquarie has indicated it would be keen for him to stay on.
"Under the full control of Macquarie."
