Karoon Energy Ltd (“Karoon”) provides the market with the following update on the Baúna asset acquisition:

• The Board of Directors of the Agência Nacional do Petróleo, Gás Natural e Biocombustíveis (“ANP”)  approved with conditions, at a board meeting on 22 October 2020, the assignment of the rights and obligations under Concession Contract BM-S-40 related to the Baúna field. Karoon expects satisfaction of the conditions to occur in the ordinary course of business.
• Once written confirmation of the ANP’s board approval is issued, a further condition precedent to transaction close under the Baúna sale and purchase agreement and the last
• outstanding regulatory condition precedent will be satisfied.
• The ANP board approval follows the issue of new environmental operational licences by IBAMA (the Brazilian Institute of the Environment and Renewable Natural Resources) as
• announced to the market on 13 August 2020.
• Transaction close still remains subject to certain conditions precedent, including FPSO charter assignment. In relation to the FPSO charter assignment, Karoon does not consider that this will delay transaction close.
• Karoon is aiming to close the transaction on 30 October 2020.

Baúna asset overview

• Concession BM-S-40 is in the southern Santos Basin, 50-60km from Karoon’s Neon and Goiá discoveries and 50km from Karoon’s Clorita exploration area
• Current Baúna production asset includes 6 oil production wells, 3 water injection wells and 1 gas injection well exploiting 2 reservoirs (Baúna & Piracaba)
• All wells are subsea completions with tie-ins back to the FPSO Cidade de Itajaí (FPSO)
• Facility has 80,000 bopd processing capacity and ~600,000 bbl storage capacity with scope to accept additional tie-ins
• FPSO is currently utilizing around 46% processing capacity
• Currently producing ~16,000 bopd, with identified production growth opportunities through well interventions and development of Patola

Baúna work-over campaign

• Significant scope to improve field production through intervention work
• Workover campaign targeted to improve production performance in 4 of 6 producing wells
• Campaign consisting of replacing 2 failed down-hole pumps (previously 3), installing gas-lift and re-opening a previously shut-in reservoir zone – all considered routine field management procedures
• Programme costs to benefit optimised programme and low oil price environment resulting in weak rig and services markets
• Leverages Karoon’s extensive experience of offshore operations in the Southern Santos basin, Brazil

KeyFacts Energy: Karoon Gas Australia Australia country profile