Norway-based Statoil announced Wednesday it will begin exploring for shale resources in Australia's Northern Territory through a joint venture with Petrofrontier.
The companies could drill 10 to 20 wells by 2017 in three phases to the potential of the permits, which encompass more than 13 million acres and are considered high risk but with significant upsides, Statoil said in a statement.
The joint venture is in line with Statoil's objectives' of accessing shale plays in the early exploration stage, at low cost and developing them into potentially high value assets, said Atle Rettedal, senior vice president for New Ventures, in a statement.
Statoil has farmed into PetroFrontier's existing exploration permits EP 103, 104, 127 and 128 and pending exploration permits 213 and 252 in the South Georgina Basin. PetroFrontier will operate the program's first phase. Statoil has secured options to operate the drilling program from the second exploration phase and have increased ownership interests from 25 percent to 65 percent of Petrofrontier's interests.
As part of the agreement, Statoil will contribute $25 million for the exploration program's first phase, and could contribute $200 million through the second and third phase, depending on exploration results.
"Statoil is a highly regarded international exploration company, actively involved in major unconventional plays and brings exceptional financial resources and technical capabilities to our new relationship," said Petrofrontier President and CEO Paul Bennett in a statement.
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