Australian oil and gas company Exoma Energy Limited  announced that it has executed a Supplemental Farmin Agreement and a Subscription Agreement, with a minimum combined value of approximately AUD$23.4 million, with China National Offshore Oil Corporation via its Australian subsidiary, CNOOC Galilee Gas Company.

On the execution of these strategic agreements Exoma Chairman, Mr Brian Barker, said: "We are very pleased to further strengthen our relationship with CNOOC and view this additional investment as indicative of CNOOCs strong support for our exploration program and our assessment of the resource potential of our permits."

"With funding for our exploration program for 2013/14 now secured, we are excited about unlocking the value we believe to be inherent in our portfolio of permits.

"Most importantly, the introduction of CNOOC as a significant shareholder in Exoma, with an initial shareholding interest of approximately 13%, is a further demonstration of the shared vision of Exoma and CNOOC as we progress our exploration and appraisal activities."

Supplemental Farmin Agreement Under the terms of the Supplemental Farmin Agreement, CNOOC will increase its participating interest from 50% to 60% in Exoma's ATP's 991, 996, 999, 1005 and 1008 and, subject to grant, new ATPs 1127, 1130, 1137 and 1150, situated in the Galilee and Eromanga Basins in Central Queensland.

CNOOC will earn its additional 10% interest by contributing a further AUD $12.7 million towards Exoma's share of exploration and appraisal expenditure during the Additional Farmin Period, which expires on 31 December 2015.

This Supplemental Farmin Agreement follows on from the Farmin Agreement entered into by Exoma and CNOOC in December 2010 under which CNOOC agreed to fund AUD$50m towards exploration and appraisal costs to earn its original 50% interest in Exoma's ATPs.

Strategic Placement via Subscription Agreement CNOOC has simultaneously entered into a Subscription Agreement whereby it will acquire 62,103,664 Ordinary shares in Exoma at 17.2c per share, for a total consideration of approximately AUD$10.7 million.

This placement, which is at a significant premium to current market share price, is based on the 90 day VWAP to close of business on 10 August 2012, plus 25%. On completion, it is expected that CNOOC will hold approximately 13% of the current issued capital of the Company.

So long as CNOOC holds more than 9% of the issued shares in the company, CNOOC has the right to appoint a director to the board.

In addition, Exoma has agreed, subject to shareholder approval, to issue additional shares at 17.2c per share to take CNOOC's holding in Exoma up to 19.9%. CNOOC has an option which must be exercised within five days of completion of the initial placement to nominate the number of shares to be issued by Exoma under this part of the agreement.

On receiving CNOOC's nomination, Exoma will seek shareholder approval to issue the new shares.