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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): DECEMBER 22, 1998
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PETSEC ENERGY INC.
(Exact name of registrant as specified in its charter)
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NEVADA 333-31625* 84-1157209
(State or other jurisdiction (Commission File Number) (I.R.S. Employer Identification No.)
of incorporation or organization)
143 RIDGEWAY DRIVE
LAFAYETTE, LOUISIANA 70503
(Address of principal executive offices) (Zip code)
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Registrant's telephone number, including area code: (318) 989-1942
*Petsec Energy Inc. is a wholly owned operating subsidiary of Petsec Energy Ltd,
a listed Australian public company registered with the Commission as a result of
its public offering in July 1996 of American Depositary Receipts ("ADRs") which
are listed on the New York Stock Exchange (symbol: PSJ).
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Item 5. Other Events.
On December 22, 1998, Petsec Energy Ltd issued a press release
announcing the execution of a letter agreement by its wholly owned subsidiary,
Petsec Energy Inc. ("PEI"), with Apache Corporation whereby PEI agreed to sell
50% of its working interests in certain oil and gas properties in the Gulf of
Mexico for US$68.5 million in cash to Apache. The transaction is subject to due
diligence and the execution by the parties of definitive agreements. The
effective date is January 1, 1999 with closing anticipated on or before February
1, 1999 at which time Apache will assume operatorship of the leases.
The foregoing summary is subject to the full text of the press release
with respect thereto, a copy of which is attached hereto as Exhibit 99.1 and is
incorporated herein by reference.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
99.1 Press Release dated December 22, 1998 of Petsec Energy Ltd with respect
to letter agreement between Petsec Energy Inc. and Apache Corporation.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
PETSEC ENERGY INC.
Date: January 11, 1999 By: /s/ ROSS A. KEOGH
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Name: Ross A. Keogh
Title: Vice-President--Finance
and Administration
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EXHIBIT INDEX
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Exhibit
Number Description
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99.1 Press Release dated December 22, 1998 of Petsec Energy Ltd
with respect to letter agreement between Petsec Energy Inc.
and Apache Corporation.
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EXHIBIT 99.1
PETSEC ENERGY LTD
(A.C.N. 000 602 700)
22 December 1998
PETSEC ENERGY TO RAISE US$68.5 MILLION WITH CASH SALE OF CERTAIN U.S.A. OIL AND
GAS INTERESTS
Sydney, Australia - Petsec Energy Ltd (ASX: PSA and NYSE: PSJ), today announced
that its wholly owned subsidiary, Petsec Energy Inc. had signed a letter
agreement with Apache Corporation to sell 50% of its working interest in certain
oil and gas properties in the Gulf of Mexico for US$68.5 million (A$110 million)
in cash.
Upon completion of the transaction, Petsec will hold a 100% working interest in
21 leases in addition to a 50% working interest in 23 joint venture leases. All
of these leases are situated in the shallow waters of the Gulf of Mexico.
The company intends to use the proceeds from the sale to repay a significant
proportion of its senior bank debt, for capital expenditures and to provide
working capital.
Petsec Energy Ltd Managing Director Terry Fern said, "The joint venture with
Apache broadens our scope. Jointly we will explore and develop the remaining
reserve potential on those leases, while our management and technical team will
direct their efforts towards the exploration and development of the company's
remaining 100% owned portfolio of exploration properties. The company is
preparing for the upcoming Federal Lease Sale in March 1999 as well as seeking
additional opportunities through joint ventures with similarly focused Gulf of
Mexico operators."
"This transaction represents the end of our review of strategic alternatives.
Reducing bank debt in this period of depressed commodity prices will enable us
to significantly improve the financial strength and flexibility of the company.
Significant reductions in general and administrative expense will also be
achieved. The company's profile will be different from that when it entered the
strategic process, in answer to the changing dynamics of the industry. I'm
confident our management and technical team will grow Petsec in this difficult
market", Mr.
Fern said.
The company is selling 50% of its working interest in producing leases at Main
Pass 6, 7, 84, 91 and 104, Grand Isle 45, South Marsh Island 7, Ship Shoal 193,
194 and West Cameron 237, 543 and 544. Petsec is also selling 50% of its working
interest in non-producing leases at Main Pass 90, 91E, 93 and 105, Ship Shoal
192 and West Cameron 542 and 653. The company currently owns a 100% working
interest in all of the above mentioned leases.
The transaction is subject to due diligence in regard to title, environmental
and mechanical condition of the surface facilities and also to the execution by
the parties of a mutually acceptable purchase and sale agreement and joint
operating agreement. The effective date is January 1, 1999 with closing
anticipated on or before February 1, 1999 at which time Apache will assume
operatorship of the leases.
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For further information please contact:
In Australia: In USA:
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Doug Battersby, Technical Director Ross Keogh, Chief Financial Officer
Petsec Energy Ltd Petsec Energy Ltd
(61) 2 9247 4605 (phone) (318) 989 1942 (phone)
(61) 2 9251 2410 (fax) (318) 989 7271 (fax)
Level 13, Gold Fields House 143 Ridgeway Drive, Suite 113
1 Alfred Street, Sydney, NSW 2000 Lafayette, Louisiana 70503-3402
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Company information is available at Petsec's web site http://www.petsec.com
1. Information in this report which relates to hydrocarbon reserves is based on
information compiled by a person qualified in accordance with Listing Rule 5.11
and accurately reflects the information compiled by that person.
2. Certain statements in this report regarding future expectations and plans of
the Company may be regarded as "forward-looking statements" within the meaning
of Section 27A of the USA Securities Act of 1933 and Section 21E of the USA
Securities Exchange Act of 1934. Although the Company believes that its
expectations and plans are based upon reasonable assumptions, it can give no
assurance that its goals will be met. Actual results may vary significantly from
those anticipated due to many factors, including oil and gas prices, operating
hazards, drilling risks, environmental risks and uncertainties in interpreting
engineering and other data relating to oil and gas reservoirs, as well as other
risks discussed in the Company's SEC filings.
