The third and most interesting one that I was not aware of.In...

The third and most interesting one that I was not aware of.

In the announcement 11 April 2014

The Backreef Block owned 100% by OBL has some massive numbers at deep levels and at P90 over 3,000 MM bbl. Finalisation of all environmental submissions have been lodged (OBL 100% and Operator) and is farmout ready. As detailed below royalties on the Backreef Block is to be paid by BRU. If and when OBL discover the new oil play it could potentially send BRU bankrupt with the liability of paying the royalties. It could be as high as 3%. A massive blunder by BRU management.

Backreef Area PRMS Prospective Resources
Product P90 P50 P10 Mean
Oil-in-Place MM bbl 3,063 6,645 12,333 7,302
Recoverable Oil MM bbl 139 391 1,008 510
Recoverable Solution Gas Bcf 119 370 1,073 517


Royalty Interests – Backreef Area (future discoveries) OBL Group 100% beneficial rights
Earlier in the quarter Fitzroy River Corporation (formerly European Gas Limited (ASX code: FZR)), who owns a royalty on L6/EP129 (called the Lennard Shelf Royalty), sought clarification of the future royalties payable by the OBL Group. In accordance with the terms of the BPA, such would not be payable by OBL to FZR (although there could be an independent obligation by BRU and/or its subsidiaries) and any royalties were only to be paid under the BPA if the Backreef-1 well drilled to 1500m consisted a discovery under PRMS, which it did not, and so royalties are not payable by OBL on the Backreef Area generally.