Japan’s Inpex, operator of the giant Ichthys LNG project, said it has reached an agreement to transfer 10% of its participating interest in the Deepwater Block R to Australian LNG player Santos.
Santos Sabah Block R Limited, a unit of Santos, also separately agreed to acquire a 10% participating interest in the Block from JX Nippon Oil & Gas Exploration (Deepwater Sabah), Limited (JX), bringing its total participating interest in the Block to 20% upon fulfillment of due procedures.
Inpex Offshore South West Sabah currently owns a 37.5% participating interest in the Block, where it conducts exploration activities alongside operator JX and Petronas.
The Block located in offshore East Malaysia covers an area of 672km2 with a water depth ranging from 100m to 1,400m. The Block lies in the area where large reserves of oil and natural gas, such as the Kikeh and the Gumusut-Kakap oil fields were discovered.
The Block also is situated in the vicinity of Deepwater Block S, where
Inpex conducts exploration activities as operator, and transferred a portion of its participating interest to Santos, as announced on September 1 last year.
After the acquisition of the Block in January 2012, a three-dimensional seismic survey and geological and geophysical studies have been conducted. Based on the result of the studies, the drilling of a total of three wildcat wells is planned beginning in 2015 in search of oil and natural gas deposits.
Inpex and Santos are jointly engaged in many oil and gas exploration and production activities such as the Bayu-Undan Project in the Joint Petroleum Development Area between Australia and Timor-Leste and several exploration permits adjacent to the Ichthys LNG project in the north-western Australia.