Melbana retains 100% stake in Cuba's block 9

Melbana Energy said Petro Australis failed to achieve pre-qualification to enable a timely application to Cuban regulatory authorities for the acquisition of a 40% interest in the onshore block 9 production-sharing contract.

Cuba's regulatory pre-qualification is normally an administrative process required for parties to demonstrate they satisfy the financial and technical competency criteria specified in applicable legislation before they can acquire certain interests in Cuban hydrocarbon assets, the Melbourne-based company said in a press release.

"As a result, Melbana has terminated its commercial arrangements with Petro Australis such that Petro Australis no longer holds a right to acquire a 40% participating interest in block 9," Melbana added.

"Melbana considers that the time for prequalification is passed and that Petro Australis' entitlement to any interest in block 9 has lapsed."

Melbana originally pursued block 9 in collaboration with Petro Australis under an agreement between the companies entered into in May 2012 whereby Petro Australis was granted a conditional right, which it had to exercise prior to September 2, 2017, to acquire a 40% participating interest in block 9, subject to regulatory approvals.

With Petro Australis having failed to obtain Cuban regulatory pre-qualification, Melbana said it would continue the farmout process it has already commenced and plans to drill up to two wells on block 9 in 2018 remain on track.

"Melbana now has an unfettered 100% participating interest in Block 9 PSC providing additional farmout flexibility. We will continue our farmout process with our data room remaining open and active. Our preparatory activities for drilling in 2018 also continue unabated with good progress," Melbana's CEO Peter Stickland said.