Cooper Energy to Buy BHP’s Stake in Minerva Gas Plant

Australian-listed Cooper Energy (ASX:COE), in partnership with AWE and Mitsui E&P Australia, is set to purchase BHP Billiton’s (ASX:BHP,NYSE:BHP,LSE:BLT) 90-percent interest in the Minerva gas plant in Victoria.

The Minerva gas plant is one of three onshore gas-processing plants currently processing gas from the offshore Otway Basin.

Currently, Cooper is a minority holder in the Minerva plant, with a 10-percent interest. When the deal is complete, Cooper will own a 50-percent interest in the plant, while AWE and Mitsui E&P Australia will each own 25 percent.

“Our analysis indicates the plant can offer a highly competitive processing option for gas from Casino Henry and other gas fields in the region,” states Cooper Energy in a press release. “Ownership of the plant has clear strategic merit and can significantly further enhance the economics of Otway Basin gas development and production.”

The agreement to acquire Minerva from BHP is conditional on the completion of regulatory approvals and assignments, and provides for the transfer of the plant and associated land after the cessation of current operations processing gas from the Minerva gas field.

The Minerva plant, which is located about 5 kilometers northwest of Port Campbell, was put into service in January 2005. The gas plant is directly connected to the SEAGas Port Campbell to Adelaide pipeline, and to the South West pipeline, both owned by APA Group.

This is the third time Cooper has joined forces with AWE and Mitsui E&P Australia for an acquisition. The three companies came together in early 2017 to purchase interests in the Casino Henry gas project as well as VIC/P44 exploration acreage in the Otway Basin.

Cooper and its partners have already commenced advanced preliminary engineering design work for processing gas at the Minerva gas plant. This would mean the construction of a 0.25-kilometer pipeline tie in, as well as the modification of well control systems to connect to the Casino Henry project.

According to Cooper’s managing director, David Maxwell, the Minerva plant acquisition would also dovetail with Cooper’s exploration and development plans for the Otway Basin, which include lifting production through the drilling of a development well on the Henry field, and drilling for new gas reserves.

While Cooper, AWE and Mitsui E&P Australia will own and operate the onshore Minerva plant, BHP will maintain its 90-percent shareholding in the offshore Minerva gas field and gas pipeline, with Cooper holding the remaining 10-percent interest.

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Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.