THE WALL STREET JOURNAL
JANUARY 20, 2009, 10:00 P.M. ET
MELBOURNE (Dow Jones)–Arrow Energy Ltd. (AOE.AU) said Wednesday that Royal Dutch Shell PLC (RDSA) had bought a 10% stake in its Singapore unit, Arrow International Pte., for US$66 million as part of a previously announced deal.
The unit holds Brisbane-based Arrow’s interests in India, Vietnam, China and Indonesia, the company said in a statement.
Arrow has the potential to earn more from Shell, including US$25 million on signing of two license/production sharing contracts once the initial US$50 million is expended, the company said.
The company also may earn US$50 million if proven and probable reserves in which Shell and Arrow hold an equity interest exceeds 5 trillion cubic feet before Dec. 31, 2015, Arrow said.
As part of the transaction, Shell bought a five-year option to acquire up to half of Arrow’s interest in any Arrow International project by payment of Shell’s share of sunk costs, excluding Arrow’s three Indian coal seam gas licenses, it said.
-By Andrew Harrison, Dow Jones Newswires; 61-3-9671-4323; [email protected]
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