Finder directors have unanimously accepted a $A25 million offer consisting of 80 million Gippsland Offshore shares at a price of 31¢ per share, according to Gippsland Offshore managing director, Cathy Norman.

“Together Gippsland Offshore and Finder will create an ASX-listed upstream oil and gas company with a market capitalisation of approximately $65 million, offering Gippsland Offshore shareholders a wider range of exploration projects,” she said.

“The deal will create an entity with an excellent asset portfolio spread across seven countries. The addition of Finder’s 100% owned Browse basin permit to Gippsland Offshore’s portfolio gives us a strong position in

Australia’s premier exploration acreage.”

The AC/P 36 permit in the Browse Basin, offshore Western Australia is 100% owned by Finder and sits 80km north of the Inpex-operated Ichthys gas field estimated to contain approximately 8 trillion cubic feet of natural gas.

“The Browse region is fast gaining importance as an area likely to host global-scale liquefied natural gas developments,” Norman said.

“The Browse permit has complete 3D seismic data coverage and Finder has undertaken interpretation and seismic inversion to delineate and characterise drillable prospects. There is a well commitment in this block in 2009.”

Through the takeover of Finder, Gippsland Offshore will also have exploration projects in Australia, Jamaica, Madagascar, France, Kenya, the UK and New Zealand.

Gippsland Offshore and Finder are equal partners in the key Jamaica exploration project after jointly being awarded five blocks in the first Jamaica licencing round for 20 years. Already the partners have acquired an extensive 2D seismic survey and airborne gravity gradiometry data using the advanced BHP Billiton Falcon system to enable regional mapping and prospect identification.

“The combined entity will benefit from owning 100% of our exciting Jamaica exploration project,” Norman said.

“Our two companies have been working together on this project and we welcome the addition of Finder’s technical and entrepreneurial skills to complement our exploration team.”

Finder also offers Gippsland acreage in Madagascar, New Zealand’s Taranaki basin (in partnership with Tap Oil and Mighty River Power) and the UK North Sea’s Southern Gas Basin.

A nominee of Finder will be invited to join the board of Gippsland Offshore.

The offer for Finder remains conditional on Gippsland Offshore completing satisfactory due diligence on Finder and the signing of a sale and purchase agreement between the parties. These are expected to be completed early in September.

The issue of Gippsland Offshore shares under the takeover offer is subject to approval of the shareholders who will soon receive details of the transaction.

The merger will increase the Gippsland Offshore capital from 129,982,380 ordinary shares to 209,982,380 ordinary shares.