The initiative involves a capital program of up to A $18.5 million to complete 300 square kilometers of 3D seismic surveys and to drill up to seven wells over the next 18 months. Avery will be responsible for A $4.4 million of the full program, which it will fund from its current cash position, with the remaining A $14.1 million funded by Santos.
As a result, Avery will have earned a 30% interest in the Wompi Block and a 25% interest in the Barta Block, with Santos earning 40% and 45% interests respectively. Avery's current partners in the blocks, Bow Energy Limited and Victoria Petroleum Limited, will be entitled to the remaining interests.
"This agreement with Santos, a major Australian oil and gas exploration and production company, will enhance our Cooper Basin exploration and development program while reducing the risk of unsuccessful wells," said David Little, CEO of Avery. "We believe that Santos' application of large 3D seismic programs and their proven track record of finding and developing commercial discoveries in the Cooper Basin will greatly improve our success rate and add value for our shareholders going forward."
The Barta and Wompi Blocks are adjacent to lands held by Santos, which are the subject of an accelerated exploration and development program being undertaken as part of the Santos Cooper Oil Project.
Avery Resources is an international junior oil and gas exploration company based in Calgary, Alberta, that trades on the TSX Venture Exchange under the symbol ARY. With primary interest in Australia, Avery has plans to drill up to 10 wells over the next year.
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