Lakes Blue Energy asset sale update

Lakes Blue Energy NL (ASX:LKO) has finalized the sale of its 49% interest in the Victorian Petroleum Exploration Permit 169 (PEP 169) to ADZ Energy Pty Ltd. The transaction, completed on October 9, 2024, brings an initial payment of A$3 million, with an additional A$3.5 million anticipated after formal registration. The funds will support Lakes' development efforts in its gas-rich Wombat and Trifon/Gangell fields.

PEP 169 sale and future plans

Lakes Blue Energy NL has successfully completed the sale of a 49% stake in PEP 169 to ADZ Energy Pty Ltd, securing an initial payment with further proceeds contingent on registration completion. The transaction includes ongoing royalty arrangements tied to petroleum production. Proceeds will be directed towards the development of the Wombat and Trifon/Gangell fields, leveraging significant gas reserves. Lakes is also preparing for future drilling activities, with plans to drill the Wombat-5 well by mid-2025. This strategic maneuver underscores the company's focus on monetizing assets to fuel growth in its core areas.

Executive insights on PEP 169 transaction

All preconditions for the sale were fulfilled by October 4, 2024. The transaction was completed on October 9, 2024, with an initial payment of A$3 million received. An additional A$3.5 million is pending and will be received once DEECA finalizes the registration of the transfer. Lakes will receive ongoing royalty payments based on the wellhead value of petroleum produced, approximately 4%, calculated similarly to royalties paid to the Victorian Government under the Victorian Petroleum Act 1998.