Strike grants West Erregulla offtake option to CSBP

Key terms of the Gas Sales option agreement

• CSBP granted an option for the supply of 80 to 100PJ of gas (Strike share), to be delivered at a maximum of 25 TJ/d from commencement of production from West Erregulla.
• CSBP will pay an option fee to Strike of AUS $5 million by 30 May 2019.
• The option is conditional on a successful result at the West Erregulla- 2 well (WE-2) and Strike taking FID on a commercial project.
• Option will lapse 7.5 years after completion of WE-2 if the opportunity to exercise has not been taken.
• If the WE-2 well is unsuccessful Strike will be required to refund 50% of the option fee in cash or shares at Strike’s election.
• The AUS $5 million option fee will be used as operating capital for the delivery of WE-2, designed to delineate the major conventional gas target in the Kingia- High Cliff sandstones. WE-2 is expected to be completed as a future producer due to the high chance of success of the well encountering commercially recoverable hydrocarbons.