Karoon Gas Australia has issued a default notice to Pacific Exploration and Production Corp., its joint venture partner in the Santos Basin blocks offshore Brazil, in respect of an overdue payment.
Karoon has 65% interest in five Santos Basin blocks, S‐M‐1037, 1101, 1102, 1165 & 1166, and Pacific holds the remaining 35%.
Karoon said the company has issued the notice to Pacific consistent with the its rights under the Joint Operating Agreement (JOA).
“Both parties are working together to resolve the issue and Karoon will provide further updates as necessary,” the company said in a statement on Tuesday.
The company also added that the planned Echidna appraisal drilling campaign scheduled for the September quarter 2016 is currently under review.
Karoon’s Managing Director, Robert Hosking said: “While it is unfortunate the JOA default provisions have been triggered, Karoon and Pacific will be working together to remedy the current situation as quickly as possible. It is in both our interests to work together to resolve this issue in a timely manner and continue with the good work done on the Echidna light oil discovery to date.”