3D Oil Ltd. reported that its subsidiary, 3D Oil T49P Pty Ltd., has completed the farmout of Tasmanian Permit T/49P to ConocoPhillips Australia SH1 Pty Ltd. following approval by the National Offshore Petroleum Titles Authority. Under the agreement, COP will hold an 80% interest in the permit and become operator.
As previously announced, the company will receive a A$5 million cash payment and COP will carry out a 3D seismic survey this year. Upon completion of the acquisition, processing and interpretation of the 3D seismic survey, COP may elect to drill an exploration well. In the event COP drills a well, TDO will be carried for up to $30 million in drilling costs after which it will contribute 20% of drilling costs.
“While global conditions are very challenging the potential for gas commercialization in Eastern Australia are very promising,” TDO said in a written statement. “TDO believes these conditions create opportunities for the company to exploit. The company is firmly focused on becoming a supplier to the burgeoning East Coast Gas market at a time of unique dynamics in local and global gas markets.”
“3D Oil is of the opinion that the combination of falling domestic production on the East Coast, primarily from Bass Strait, and a gas-led recovery within Australia and the industrialized economies of SE Asia will significantly improve the domestic gas market in the medium term.”
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