Melbana Energy has received a request from Total and Santos to extend by one month the date by which they must exercise the options they each hold to acquire a 40% interest in WA-488-P in return for agreeing to jointly fund the drilling of the Beehive-1 exploration well off Australia.
The contractual start of a six-month “option period” for the two companies to farm into the Melbana-operated Beehive prospect and drill the first exploration well there was triggered last April following the receipt and approval of the final processed data from the Beehive 3D seismic survey.
Melbana confirmed some key technical characteristics of Beehive, further de-risking the prospect, in June 2019.
According to Melbana’s statement on Thursday, Total and Santos confirmed that they had completed their technical assessment of the Beehive prospect and the additional time requested is needed by the companies to finalize their commercial analysis and seek internal approvals.
The extension to the option period is not expected to impact the ability of the companies to drill the Beehive-1 exploration well before the end of next year, should Santos and Total elect to exercise their options.
In light of this, Melbana said on Thursday it had agreed to extend the option period by the requested one month given the significant and timely application shown by the companies to date in evaluation of the Beehive prospect.
Total and Santos now have until November 4, 2019, to notify Melbana of their decision with regards to the exercise of their options. The options therefore now expire on December 4, 2019.
Should Total and Santos elect to exercise their options, they would each receive a 40% interest in Melbina’s WA-488-P license area (containing the Beehive prospect) in return for committing to jointly funding the cost of the Beehive-1 exploration well, in which Melbana would be free carried for its 20% interest.
Beehive has been assessed by Independent Expert McDaniel & Associates to contain a best estimate prospective resource of 388 million barrels of oil equivalent.
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