Please Note: Blog posts are not selected, edited or screened by Seeking Alpha editors.

New Guinea Energy receives unsolicited approaches on certain assets, appoints advisors

New Guinea Energy (ASX:NGE) is generating significant interest in its Papua New Guinea assets and has received a number of unsolicited approaches.

The company, which appointed RBC Capital Markets to assist with the approaches, is in continuing discussions in relation to potential transactions.

New Guinea Energy is currently also engaged in a broader strategic review of its operations.


De-Risking


A number of New Guinea Energy’s prospects are already in the process of being de-risked by current drilling activities in adjacent properties.

Several petroleum majors operate nearby and have an established presence in Papua New Guinea including Exxon Mobil (NYSE: XOM), Interoil (NYSE: IOC), LNG Energy (TSX: LNG), Oil Search (ASX: OSH), Horizon Oil (ASX: HZN), Eaglewood Energy (TSX: EWD), and Talisman (ASX: TLM).

New Guinea Energy has six onshore licences that cover more than 44,800 square kilometres and is the operator of four of them while joint venture partner Talisman operates the other two licences.

The company has 101 leads and prospects and total gross prospective resources of 6,000 million barrels of oil equivalent.

Two appraisal wells by the Exxon Mobil-Oil Search joint venture and three others involving Talisman will assist New Guinea Energy without the company having to drill a well.

The company is poised to benefit from the rapid expansion of the oil and gas infrastructure boosted by projects such as the PNG LNG ExxonMobil led project (floating LNG project), and with its partner Talisman providing substantial support.


Strong Cash Position
 
With a net cash position of A$29 million at the end of the September quarter it provides New Guinea Energy with the necessary capital to complete its working program commitment for the first half 2012.