Houston American Energy Corp. agreed to purchase ordinary shares of Australia’s Tamboran Resources Ltd. for $1 million, the company said Feb. 24.
Houston American's purchase, when completed, will represent a 12.5% ownership interest in Tamboran and includes anti-dilution provisions that might maintain that ownership level for a period of nine months with respect to certain equity issuances by Tamboran.
Closing of the purchase is subject to Tamboran’s receipt of about US$500,000, or AU$705,000, of additional funding from the sale of ordinary shares to other parties.
John Boylan, president of Houston American, said that Tamboran has 1.6 million net acres and 25% working interest in the Beetaloo/McArthur Basin, but the working interest could be raised.
He said that Houston American’s cost of investment is $5 per acre.
"Tamboran has assembled what we believe is a highly attractive Australian unconventional resource play and a world-class management team with a long track record of success in early-stage E&P development in North America, Boylan said.
“We are particularly excited by three aspects of the Tamboran play as compared to opportunities we have seen elsewhere: the strength of the management team; the ability to participate in a large acreage position at ‘ground floor’ prices; and the highly attractive technical attributes of operations in the Beetaloo/McArthur Basin,” he added.
He also said that the Beetaloo/McArthur Basin compares favorably to U.S. shale plays: well logs on Tamboran's initial test well reflect potential resource recoveries equaling or exceeding the best U.S. shale plays.
Houston American Energy Corp. is based in Houston.