oil majors interested in nexus's crux stake

Oil majors interested in Nexus's Crux stake
The Australian
November 23, 2012

NEXUS Energy has received interest from what are believed to be major oil companies in a full and partial selldown of its $638 million stake in the Crux gas field in Western Australia's offshore Browse Basin.

Nexus chief executive Lucio Della Martina said the Crux field operator, Shell, believes a stand-alone FLNG development may be a viable option for Crux and that studying this option was expected to be part of a retention lease work program.

Nexus last month finalised a deal that gave it a 17 per cent stake in the Crux field -- to which it previously held liquids rights only -- and the option to sell a 2 per cent stake to Shell for $75m.

The completion of the deal has allowed Nexus and the financial advisers it appointed in August to step up their exploration of options for the stake which, based on the option, is worth about $638m.

"We have received expressions of interest and are now formally engaged with a range of very high-quality parties," Mr Della Martina said.

"We have received interest in both a tranche of the asset and potentially the entire Nexus stake."

He would not say who the parties were, but it is believed they include leading oil companies operating in the region.

He said the intention was to sell a part of the Crux stake but the board would consider all options. An announcement on the stake sale could happen next quarter, Mr Della Martina said.

Bidders interested in the whole Crux stake would also probably be interested in Nexus's Echuca Shoals asset, also in the Browse Basin.

Nexus wants Crux to be investigated as a stand-alone floating LNG project but there has been speculation Shell would rather save the gas for when reserves run low at its Prelude floating LNG project nearby.

Mr Della Martina said the work program the partners had proposed for the retention lease, which is in the hands of the federal government, involved assessment of a stand-alone FLNG plant. "The joint venture is aligned that the stand-alone is potentially viable," he said, adding that this would depend on exploration success in the permit.

At the AGM, new chairman Don Voelte, who is also chief executive of Seven West Media, was questioned about his ability to devote enough time to Nexus.

Mr Voelte said this had not been a problem when he was chief executive of Woodside Petroleum and a non-executive director of West Australian Newspapers. "I like work, I'm not, probably, the poster boy for life versus work," he said.

Nexus's remuneration report, which was voted down last year, was approved by 99 per cent of voting shareholders, avoiding a board spill for the company under the two strikes rule.

Link: http://www.theaustralian.com.au/business/mining-energy/majors-interested-in-nexuss-crux/story-e6frg9df-1226522322108