PRZOOM - /newswire/ -
London, Greater London, United Kingdom, 2006/06/03 - Ascension Securities Ltd are pleased to announce that they will be acting as corporate advisers to Allied Oil & Gas Plc.
Allied Oil & Gas Plc, which was incorporated in March 2006 in order to carry out oil and gas exploration and production activities within its newly acquired concessions in the Perth Basin, Western Australia. These areas have considerable potential for the discovery and recovery of oil and gas.
Members of the Board of Allied Oil & Gas Plc have relationships with certain listed and private oil and gas exploration and production companies which they have used to secure a farm-in agreement in relation to three exploration licences over properties in the Northern Perth basin in Western Australia. The Directors believe that they will be able to source additional opportunities to acquire interests and farm-in opportunities in Australia.
The company’s policy is to acquire interests through farm-in arrangements with a third party oil and gas exploration company which has acquired a licence over a property which Allied Oil & Gas considers to have appropriate potential for hydrocarbons – this is the company’s principal method of operation in Australia where certain of its directors have relationships with listed and private oil and gas exploration and production companies which they consider will enable the company to source farm-in opportunities.
Allied Oil & Gas’s proposed activities should be viewed in the context of the worldwide increase in oil and gas exploration which has arisen due to the demand for oil and gas and the substantial increase in prices. The Directors, based on opinions expressed by industry experts, expect the demand and current high prices to remain prevalent for the foreseeable future. If correct, this means firstly that potential rewards now balance exploration risk which generally must be regarded as high, and secondly that properties which might historically have been regarded as uneconomic are now economic, and should remain so for the foreseeable future.
The company's current focus is on exploiting existing interests, but it also has the objective of seeking, acquiring and exploiting additional oil and gas opportunities in Australia and other prospective areas. Allied Oil & Gas was initially formed to acquire the EP416, EP426 and EP432 licences. The Directors used their contacts in Australia to enter into farm-in agreements (the “Farm-In Agreements”) in respect of the Perth Basin EP416, EP426 and EP432 licences (the “Australian Licences”) in March 2006. These are some of several farm-in opportunities that were offered to Allied Oil & Gas by Empire, being the ones that the Board considered to have the best potential.
The company's business is at present the evaluation of the Australia Licences, and its prospective participation, effectively as an investor, in the Australian Licences. Allied Oil & Gas has no material assets (other than the licences), liabilities or contractual or other obligations.
According to the Western Australia Department of Industry and Resources, Western Australia (“WA”) ranks among the best areas in the world for petroleum exploration. Western Australia’s sedimentary basins hold more than 80% of Australia’s discovered natural gas resources, despite being one of the least explored territories in the world. Onshore there is only approximately one well per 2647 sq km. Compare this to Texas where there is approximately one well per 2 sq km. Allied Oil & Gas believes there is continuing potential in the onshore Perth Basin, and has entered into three farm-in agreements which gives it the right to earn interest in the onshore licences covering approximately 8,333 sq kms.
A series of oil discoveries, the first in October 2002, has renewed interest in exploring within the Perth Basin. New exploration theories are being tested, and success rates have increased significantly. Since 1964, 51 exploration wells have been drilled in the Perth Basin, resulting in 21 field discoveries (41.2% success rate). Twenty six of these wells have been drilled since 1998 accounting for 15 of these discoveries (57.7% success rate). These statistics demonstrate a high success rate over time, and an increasing rate as technology has improved. The increase in the success rate is primarily due to the use of 3D seismic technology. Allied Oil & Gas has secured farm-in agreements in respect of three permits, EP416, EP426 and EP432.