Subject to shareholder approval, the Perth-based company said it would exchange 30 million of its ordinary shares, worth about $A7.3 million, to equity owner Kalgoorlie-Boulder Resources.

Early last month, Louisiana announced it would pay US-based Metro Energy $US1 million ($A1.32 million) to acquire an initial 25% working interest in 640 acres of oil and gas leases, in which it said the Wilson prospect was the primary area of interest.

Upon completion of both transactions, Louisiana will have a 100% working interest in the prospect.

The company said the Wilson prospect, located in Okmulgee County, was an “ideal complement” to its 100%-owned Caddo Pine Island project, in northern Louisiana.

“The transaction is consistent with the company’s strategy of seeking acquisitions that provided immediate cash flow and relatively low risk,” executive director Mathew Walker said.

“The acquisition of the Wilson prospect provides the company with additional critical mass and can be managed from within the company’s existing management structure.”

He added that completion of the Wilson 3-10 well, for which the company is free-carried, has started, with final results to be released in the next few weeks.

With paved roads and easy entrance to drilling sites, the prospect lies about near the city of Henryetta, Louisiana Petroleum said.

A gas-gathering system also runs north-south along the western border of the lease ensuring immediate access to gas sales, it said.

The primary objectives are the conventional formations of the Wilcox Sandstone and Cromwell Sandstone, and the unconventional formations of the Woodford Shale and Mississippian Caney Shale.