Carnarvon Petroleum, together with private partner Finder Exploration, disclosed Wednesday that they have received approval to farm out two of their Phoenix permits offshore Western Australia to Apache Corporation and JX Nippon.
The approval from the National Offshore Petroleum Titles Administrator for the farm-out of the WA-435-P and WA-437-P exploration permits means that Apache can move ahead to spud the Phoenix South prospect, which is tentatively scheduled for late 2013, subject to rig availability and regulatory approvals.
Under the farm-out agreement, Apache will assume operatorship of the permits and hold a majority 40 percent stake, while JX Nippon will have a 20 percent interest. Carnarvon and Finder will pare down their interests from 50 percent to 20 percent.
Apache and JX Nippon are also expected to pay Carnarvon and Finder for past costs on the permits in the current quarter, as well as cover the cost of drilling the Phoenix South well. The project partners are also considering a contingent exploration well targeting the Roc prospect.
The Phoenix South prospect is located within WA-435-P, while the Roc prospect is sited in WA-437-P. Both of the prospects target gas in the lower Triassic reservoirs. Carnarvon revealed in November last year that the gas initially in place estimates for Phoenix South and Roc are each 5.5 trillion cubic feet.
WA-435-P and WA-437-P are permits among the Phoenix cluster; the other permits in the group are WA-443-P, WA-436-P and WA-438-P.
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