3D Oil Limited (TDO) has announced that Beach Energy Limited has agreed to increase its funding of the expanded Flanagan 3D seismic survey in the T/49P permit in the offshore Otway Basin, Australia.
According to the company, the Flanagan survey is now programmed to record 974 sq km of full-fold data, significantly above the 755 sq km permit commitment. Beach will earn an additional 10% interest in T/49P by paying an increased share of the expanded Flanagan survey costs. The final cash contribution of the parties will be determined by the final cost of the acquisition and processing of the survey. The T/49P joint venture will then be TDO 70% and operator, with Beach Energy at 30%.
TDO says it intends to leverage the results of the Flanagan survey to attract the best possible farm-in terms for future exploration in this highly prospective gas exploration area. TDO adds that this current deal with Beach allows TDO to retain a large pre-drilling interest and operatorship in T/49P, while reducing cash exposure and at the same time acquiring additional seismic coverage over the targeted T/49P leads.
TDO Managing Director Noel Newell commented: “The technical and commercial fundamentals of gas exploration in this area are very strong. We consider the fact that a large Australian operator like Beach Energy has increased its stake in T49P is a strong validation of the potential of permit. It is also gratifying that Beach has confidence in our joint venture and in TDO’s operatorship of the permit.”
According to the press release, acquisition of the 974 sq km Flanagan survey is underway northwest of King Island and, subject to weather and sea conditions, it is expected to be completed by mid-December.
The Polarcus Asima is a state-of-the-art seismic vessel which is towing 10 recording streamers in an array approximately 1km wide and 6km long in order to record seismic data for the survey. T/49P covers an area of 4,960 km2 in water depths generally no greater than 100m. The permit is lightly explored covered by a broad grid of 2D seismic data of varying vintages and has two exploration wells drilled in 1967 and 1970. Since acquiring the permit in May 2012 TDO has continued to expand its assessment of the prospectivity.
TDO says that this work has only enhanced the its view that the permit potentially contains significant gas volumes. The Flanagan survey is designed to mature a number of leads in northern part of the block which are located adjacent to the neighbouring Thylacine and Geographe producing gas fields which have a combined gas in place (“GIP”) of over 2 TCF. Of particular note are the Whalebone and Flanagan leads which have a combined best estimate Prospective Resource of 7.8 TCF GIP.