Carnarvon Petroleum and Joint Venture partner, Finder Exploration, annouced that Farmin Agreements have been executed with Apache Northwest and JX Nippon Oil & Gas Exploration in relation to exploration permits WA-435-P and WA-437-P.
Following the farmin, interests in the two permits will be as follows:
The Phoenix South prospect is located within the WA-435-P exploration permit and the Roc prospect is within the WA-437-P exploration permit.
The Phoenix South prospect will target gas in lower Triassic reservoirs and will be drilled to a minimum depth of 4,500 metres. The Roc prospect will also target gas in the lower Triassic and will be drilled to a minimum depth of 4,000 metres. All parties to the Joint Venture will agree the final depth of each well once well planning work commences.
Each prospect has been estimated, by Carnarvon and Finder, to have the potential to contain multi Tcf’s of recoverable gas and significant associated volumes of liquids. The prospects are in the immediate vicinity of the Phoenix-1 gas discovery.
As a result of the farmin, Carnarvon will retain a 20% interest in each permit and will not have an exposure to the cost of drilling the Phoenix South prospect and the Roc prospect below an agreed cap, which is expected to cover the full cost of each well.
Should Carnarvon and/or Finder participate in any subsequent development then Carnarvon and/or Finder agree to use reasonable endeavours to jointly market with Apache and JX Nippon any petroleum liquids or natural gas produced from the permits, subject to the parties entering into a mutually acceptable joint marketing agreement and to the arrangements falling within the provisions of the Competition And Consumer Act 2010 (Cth).
Commenting on the farmin Carnarvon CEO and Managing Director said: “Carnarvon is pleased to welcome Apache and JX Nippon to the Joint Venture and is looking forward to working with the other Joint Venture participants in realising the potential in these permits. This is an exciting time for Carnarvon and its shareholders given the resource potential of both the Phoenix South and Roc prospects.
“We are also looking forward to unlocking the greater hydrocarbon potential in the region, especially the oil potential, and to seeing the outcomes from these and other significant activities planned in the surrounding permits.”
LNG World News Staff, October 18, 2012; Image: Carnarvon