Australian oil firm Santos has exercised an option to acquire a 40 interest in Melbana’s Beehive permit offshore W. Australia. France’s Total, which also had an option to farm-in, has decided not to proceed with the acquisition.
Santos had an option to acquire a 40 percent share, but given that Total has dropped the option to buy a stake, Santos’ option has been modified and the Australian company may acquire an 80 percent interest in the permit in return for funding 100% of the costs for an exploration well in the Permit area.
Melbana on Monday said that Santos had until December 4, 2019 to exercise the modified option.
“If Santos does not exercise this modified option, Santos will not acquire any interest in the Permit and Melbana’s interest in the Permit will remain at 100%,”Melbana said.
According to Melbana, the Beehive prospect has been assessed by Independent Expert McDaniel & Associates to contain a best estimate prospective resource of 388 million barrels of oil equivalent.
Future exploration appraisal and evaluation is required to determine the existence of a significant quantity of potentially moveable hydrocarbons.
Melbana Energy’s Chairman, Andrew Purcell, said: “Santos’ recently announced decision to acquire the northern Australian assets of ConocoPhillips, consistent with its aim to be a leading regional LNG supplier, make it a particularly exciting time for the energy sector in northern Australia. There is a great deal of interest from industry in these developments and we are confident that our Beehive prospect has a role to play there given other recent regional successes, its shallow water position close to existing infrastructure and the increased confidence in the prospect resulting from the newly processed 3D seismic survey acquired by Santos and TOTAL. We look forward to continuing to work closely with Santos and are confident that other well credentialed parties will have an interest in the Beehive prospect should the opportunity become available for them to participate in the drilling of this well.”
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