In a statement today, Drillsearch said it had decided not to exercise or extend an option to buy Beach’s 29 million shares in Great Artesian, which it had valued at $290,000 back in December.
It said after an extensive assessment of Great Artesian, it decided the 51c per share offer would not achieve a material increase in Drillsearch shareholder value.
It suggested that its “high success” in the Cooper Oil Project, which led to a 113% increase in its petroleum reserves for end of 2006, also contributed to the change of heart.
“Drillsearch will continue to seek high value petroleum development opportunities in the Cooper Basin,” the company said.
The announcement follows yesterday’s stand-down of Ray Shaw as managing director of Great Artesian, under an earlier deal with Beach.
In January, Shaw said he wanted to stay on with the company, but that was only likely to happen if the call option with Drillsearch went ahead.
