ASX Company News: Buccaneer Energy To Acquire New Drilling Rig

April 20th, 2012Jeff

Buccaneer Energy Limited (BCC) is pleased to advise that it has executed a binding purchase agreement with Glacier Drilling Company, a wholly owned subsidiary of Marathon Oil Company, to acquire the Glacier #1 Drilling Rig. The purchase price is US$7.5 million and the acquisition is scheduled to settle on 7 June 2012 (US time) and will be funded from proceeds from the $US20.0 million project finance facility that is currently being finalised. The Glacier Rig is a Mesa 1000 carrier mounted land drilling rig. It was built in 2000 and can drill to depths of approximately 12,000’. The rig is unique in that it was designed and built with the input of the drillers that would operate the rig on the Kenai Peninsula of Alaska and was designed to operate close to neighborhoods. The small size is ideal for pad drilling, minimizing the drilling footprint and impact to its surroundings. The Glacier Rig was used to drill both of the Company’s Kenai Loop wells in 2011 and the Company considers its acquisition as an important development in its ability to develop its onshore projects. The Company expects that there will be high demand for the Glacier Rig from other lease operators in the area and has already taken enquiries in respect to leasing.

Buccaneer Director Dean Gallegos said: “The Purchase of the Glacier Rig is a significant milestone and key component of our onshore Alaska strategy, as it will allow us to immediately secure enabling assets in the Cook Inlet. The purchase of the rig insures timely drilling of our Kenai Loop project and also assists in the control of costs associated with the project. Ultimately though we see the Glacier Rig becoming a profit centre for the Company. There is a shortage of high capability rigs on the Kenai Peninsula and we expect to be able to sign leasing deals with third parties while still protecting our interests”

Buccaneer Energy Limited is an Australian listed company focused on developing its 100% owned oil & gas assets in Alaska. The Company’s flagship projects are a series of onshore and offshore developmentaland exploration prospects in Alaska’s Cook Inlet. Buccaneer Energy has a 50/50 joint venture with Singaporean based Ezion, a leader in the development, ownership and chartering of strategic offshore assets and the Alaskan Industrial Developmen and Export Authority (“AIDEA”).

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