Pure board backs BG bid Thursday, 19 February 2009SUBJECT to no...

Pure board backs BG bid


Thursday, 19 February 2009

SUBJECT to no superior proposal being made within seven days of BG Group’s offer, Pure Energy’s board recommended the British company’s takeover offer in an after-market statement made yesterday evening.


BG’s cash offer now stands at $A8.00 per share, valuing Pure at $A995 million.

But Pure’s announcement yesterday of a 32% leap in its 2P (proven and probable) reserves will see Arrow Energy make a counterbid next week, and no doubt BG will go on to counter that the following week.

The question is, how far will the bidding go? And at what point, if any, will Arrow’s liquefied natural gas partner, Royal Dutch Shell feel compelled to step into the fight?

In last night’s announcement, Pure's independent directors – who collectively hold about 12% of Pure – said they unanimously intended to accept the increased BG Group offer within seven days, subject to there being no superior proposal.

“The independent directors of Pure believe the revised offer from BG Group is superior to the current offer from Arrow Energy Limited of $A3.00 in cash and 1.57 Arrow shares for each Pure share,” the statement said.

“BG Group's increased offer represents: a 168 per cent premium to Pure's closing share price of $A2.98 on December 19, 2008, being the last full day of trading before the Arrow offer was first announced; and an 11 per cent premium to the implied value of the Arrow offer of $A7.18 on February 18, 2009.”

Major shareholders Tom Fontaine and Karl Meade (who hold about 5% and 3%, respectively, of Pure) echoed the directors.

BG Group's revised offer, which opens on February 20, 2009, is unconditional.

BG has received formal notification from the Foreign Investment Review Board that there are no objections to its proposed acquisition of Pure.


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32% reserves boost ups ante for Pure

Claire Svircas, Steve Rotherham
Thursday, 19 February 2009

THE bidding game for Pure Energy will become a lot more expensive. The coal seam gas junior has upgraded its 2P certified reserves for the Cameron field in the ATP 852P lease from 394 petajoules to 522PJ.

This upgrade represents a 32% increase in 2P reserves at the Surat Basin, Queensland field and promises to test the war chest of Arrow Energy which is exchanging bids and counterbids for Pure with Britain’s BG Group.

The new reserves results are based on recent drilling and testing results from pilot wells Cameron-28 and Cameron-29, which represent the final two pilot wells in the current phase of the certification campaign.

Pure managing director Steve Beardsall said together with the recent reserve certification in Bowen Basin permit ATP 806P, the company’s total certified reserves and contingent resources now include 522 in 2P reserves; 2510PJ in 3P reserves including 1279PJ in ATP 852P; and 5649 in contingent resources including 636PJ in ATP 852P.

“This upgrade at the Cameron field confirms the development potential moving north in the permit, and provided further encouragement for converting our contingent resource and 3P reserve base into 2P reserves in the near future,” Beardsall said.

Pure says coring operations will now continue at Cameron-31, 32, 33 and 34 in the northwest of the permit with the objective to assess the potential of reserves in the area currently defined as contingent resources.