3D Oil Ltd, has executed a farmout agreement with ConocoPhillips Australia whereby the latter will acquire a 75% operated interest in the T/49P exploration permit in the Otway Basin offshore Tasmania for $5 million cash.
Prior to the deal 3D Oil held a 100% interest in the T/49P exploration permit, which covers 4,960km of the Otway Basin and is located adjacent to the producing Thylacine and Geographe gas fields.
The most recent agreement was finalised with ConocoPhillips on Dec 18.
East coast gas supply
“The beginning of this relationship represents an important step towards 3D Oil’s overarching strategy, to provide much needed natural gas to the starved east coast gas market,” 3D Oil told the ASX recently.
ConocoPhillips Australia will also acquire 1,580km2 of 3D Oil’s seismic survey and may elect to drill an exploration well upon completion of the acquisition, processing and interpretation of the survey.
The deal means 3D Oil will be carried for up to the first US$30 million of costs, whereafter it will contribute 25% of costs in line with its interest in the permit.
The agreement is conditional on the signing of a joint operating agreement and required government approvals.
“This farmout represents a milestone transaction and ensures the company is well-positioned to continue executing on its strategy across its high-quality portfolio of assets, including the promising and highly prospective 100%-owned WA-527-P,” 3D Oil executive chairman Noel Newell said.