KUTh Energy adapts PNG agreement with Kula Energy
Restorff Island, Kimbe, New West Britain, Papua New Guinea (source: flickr/ maholyoak, creative commons)
Alexander Richter
14 May 2012
Australia KUTh Energy amends agreement with Kula Energy on the possibility of the latter acquiring a majority stake in the Papua New Guinea subsidiary around three geothermal exploration projects.
Reported earlier this year, Australian geothermal developer KUTh Energy had signed an agreement with Kula Energy with the result of the latter being able to increase its stake after certain milestones have been achived.
The companies now changed the agreement with the result of KUTh Energy keeping a majority stake by limiting Kula Energy to the possibility of earning a stake of limited to 49.8% in the Papua New Guinea subsidiary of KUTh Energy.
The initial agreement of January 11, 2012 covered three exploration licenses to be converted into licenses.
“Under the original deal, Kula would earn interest in KUTh Energy (PNG) Ltd (KPNG) by investing its own equity and human resources to accelerate this conversion or buy all shares in KPNG for A$502,000.
The new deal removes the option to buy all shares in KPNG but rather would grant Kula a 35% equity interest in KPNG if it manages to achieve the grant of at least 1 licence application within 12 months or submits a new application for an additional Exploration Licence over an agreed identified area.
This will increase to 49.8% if Kula achieves both objectives.
The current applications ELA 1671 in West New Britain Province as well as ELA 1672 and ELA 1673 on Ferguson Island are considered to have strong geothermal resource potential though considerable work is needed to secure regulatory, landowner, political and market support.”
Source: KUTh Energy via Proactive Investors
