International oil and gas explorer, TAG Oil Ltd. (TSX: TAO and OTCQX: TAOIF) reported this month that a special meeting of shareholders approved the special resolution regarding the arm’s length sale of substantially all of TAG’s Taranaki Basin assets and operations in New Zealand to Malaysian-based Tamarind Resources Pte Ltd.
A total of 46.74% of TAG’s 85,282,252 outstanding shares were voted by shareholders, of which 97.47% were voted for the transaction.
Terms of the deal were:
- Cash payment to TAG of $US30 million.
- TAG to receive a 2.5% gross overriding royalty on future production from PMP 38156 (Cheal and Cardiff), PMP 53803 (Sidewinder), PMP 60454 (Supplejack), PEP 51153 (Puka), PEP 57065 (Waitoriki) and TAG’s 70% interest in PMP 60291 (Cheal East) and PEP 54877 (Cheal East).
- Up to $US5 M in event specific payments payable on achieving various milestones (the first milestone, grant of PMP 60454 (Supplejack), has already been achieved triggering a payment of $US500,000 at closing).
- The transaction will be funded from Tamarind’s available financial resources.
- An effective date of October 1, 2018 with an anticipated closing date of March 31, 2019.
Completion of the transaction remains subject to the satisfaction of several conditions, including regulatory approvals.