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Central Petroleum sells 50% of interests in Amadeus Basin fields

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Oilfield Technology,

Central Petroleum Ltd. has entered into a binding agreement with New Zealand Oil and Gas Ltd. and Cue Energy Resources Ltd., of which NZOG is a 50.04% shareholder, and certain of their respective wholly-owned subsidiaries, to sell 50% of Central’s current working interest in its Amadeus Basin Producing Assets for total consideration valued at circa AUS$85 million.

The assets being sold under the transaction consist of 50% of Central’s interests in its producing assets in the Northern Territory, namely, Mereenie Oil and Gas Field (OL 4/5)2; Palm Valley Gas Field (OL3); and Dingo Gas Field (L7)3. It is expected that the transaction will complete in 3Q21.

The exploration programme to be funded under the transaction consists of two committed prospects (Palm Valley Deep and Dingo Deep) which target 192 PJ of (unrisked) mean prospective gas resources (96 PJ net to Central after the transaction). These are two highly prospective prospects which Central has been progressing throughout the sell-down process, targeting proven hydrocarbon-bearing formations which can be efficiently tied-in to existing and future infrastructure. Both exploration well designs will access production from the existing producing formation in the event that the deeper exploration target is not successful. Drilling has been pre-approved by Central and the NZOG Entities and is expected to commence in 4Q21.

Leon Devaney, Central’s Managing Director and CEO said: “Having been so closely involved in the acquisition of our operating assets, I am now excited to see the value, created over what have been difficult market conditions, partially released. Not only are we paying down debt and reducing our liabilities, but our remaining interests will have significant near-term growth upside without funding from Central, with circa AUS$100 million of JV investment in development, appraisal and exploration in our Amadeus Basin assets.”

“Emerging from the 2020 downturn, we set an aggressive growth strategy for the business, and with today’s announcement we continue to deliver on that strategy. With our Range Pilot Program underway and FID targeted for 2022, significant development activities across our operating assets, and two significant exploration wells now funded for commencement in 2021, this is an exciting time for Central’s shareholders”.

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