31 January 2018
Lattice Energy sale reaches completion
Origin Energy Limited (Origin) today announced completion of the $1,585 million sale of its conventional upstream oil and gas business, Lattice Energy, to Beach Energy with an economic effective date of 1 July 2017.
After adjusting for settlement of the acquisition by Lattice Energy of Benaris’ interests in the Otway basin ($190 million)1, transaction costs, adjustments and taxes, the balance of the sale proceeds will be used to close out of oil forward sale agreements ($266 million) and pay down debt (approximately $1 billion).
As a result of this transaction Origin expects to record accounting charges of approximately $220 - $240 million, primarily comprising a non-cash post-tax impairment charge of $170 - $180 million as a result of recognising Lattice Energy earnings from 1 July 2017 up to the 31 January 2018 completion date. The aggregate charge is subject to finalisation of the company’s half year financial statements to be released on 15 February 2018.
1 $190 million of the proceeds of $1,585 million will be applied to the acquisition of the Benaris interests by Lattice Energy after completion of the sale of Lattice Energy to Beach.
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Opening remarks to NSW Legislative Council’s Select Committee on Electricity Supply, Demand and Prices in NSW
Energy markets here in Australia and around the world are undergoing unprecedented change as they grapple with the move to cleaner energy supplies, while maintaining affordability and reliability for customers.