At a Glance
IPB’s aim has been to position itself to capitalize on the early stage “value creation” phases of typical oil and gas asset life cycles. It is here that initial entry costs for IPB have not been overly prohibitive, and in aiming to manage the commensurate high risk, the objective of achieving superior returns for its shareholders may be achieved.
The Company has built a small and capable management team experienced in exploration, appraisal and development of oil and gas fields, which when supplemented by its close group of external consultants to execute this strategy.
In order to achieve its aim, IPB has developed a strategic plan that can be summarized by the following key points and examples:
- IPB will aim to gain early entry with a high degree of equity interest in attractive exploration or appraisal assets, preferably oil, that offer the potential for substantial upside.
- This upside potential may be achieved through the application of a new idea/technology, as was the case with the WA-424-P permit where IPB acquired new 3D seismic data to assess a small part of the permit.
- A high equity position is seen by IPB to provide leverage to exploration upside in the event of success while enabling potential funding of future work programs through a farmout or monetization of a portion of the initially high equity position.
- The Company will aim to optimise its asset holdings for strategic value:
- An example is the acquisition of permits WA-471-P & WA- 485-P, which may enable IPB to leverage off any potential success from activities in the WA-424-P permit to the South.
- IPB will continue to aim to reduce and diversify downside risk inherent with early stage oil and gas exploration:
- The presence of the oil discovery at Gwydion in the WA-424-P permit has the potential to also reduce commercial thresholds of any potential future oil discovery in the vicinity of this accumulation.
- Obtaining diversification within the asset portfolio by having three permits (WA-424-P, WA-471-P & WA-485-P), offers a level of multi-play opportunity. If one play proves unsuccessful, there remains the potential for other alternative more independent exploration plays.
- IPB will continue to seek out and review attractive opportunities and diversification options, including assessing any new blocks made available by the government.
- Farmout interests in its permits by being carried on future exploration work programmes.
Notwithstanding IPB’s ongoing objective to investigate additional complementary and risk-diversifying opportunities, if there is early and significant exploration success in the Permits, the substantial follow-up potential already identified could provide IPB with enough opportunity for value creation and growth well into the future.