Farmin by Energy Investments Limited
Posted: 9 November 2005
Great Artesian Oil and Gas Limited has completed two farmin agreements with Blue Energy Pty Ltd by which its two wholly owned subsidiaries will subscribe for a minimum total expenditure of $2.2 million in order to participate in oil and gas exploration in parts of Great Artesian’s highly prospective brownfields PEL 106 permit situated in the South Australian Cooper Basin.
Funding, for the entire cost of a 3D seismic survey and 75 per cent of the Rossco-1 well, has been provided to Blue Energy (and its subsidiaries) via secured convertible investment loans by Energy Investments Limited as part of Energy Investments acquisition of all of the share capital of Blue Energy.
Under the terms of the first farmin agreement Blue Energy’s wholly owned subsidiary Everdue Pty Ltd (ACN 116 290 441) has provided $850,000 to fund the acquisition of approximately 80 sq km 3D seismic data across the Paranta Farmin Block in PEL 106. This Block encompasses the existing Paranta-1 and Nutmeg-1 gas discoveries made in 2004 by Great Artesian. Recording of the Paranta 3D seismic program has commenced. Following acquisition and interpretation of the 3D seismic data, Everdue will have until 31 March 2006 in which to elect to fully fund an exploration well within the 3D seismic survey area in order to earn a 50 per cent interest in any production licence resulting from a commercial discovery. Everdue will also have options to drill subsequent farmin wells on similar terms within the Paranta Farmin block.
Under the terms of the second farmin agreement Blue Energy’s wholly owned subsidiary Kompliment Pty Ltd will fund 75 per cent of the forthcoming Rossco-1 well in order to earn a 37.5 per cent interest in any production licence should that well result in a commercial discovery. Drilling of Rossco-1 will commence in either late November or early December 2005. Rossco-1 lies approximately 5 km north of the Smegsy-1 gas/condensate field and 4 km south of the Paranta-1 gas/condensate discovery in PEL 106. Rossco-1 will be targeting similar Patchawarra Formation sandstone reservoirs in a structure which has the potential to host approximately 27 BCF of gas (P10).
This is the first financing activity undertaken by Energy Investments, an Australian listed energy investment company, in the Cooper Basin and provides Energy Investments with immediate exposure to two potential discoveries and early production within an existing proven hydrocarbon area.
These farmins will provide funding for exploration in a strategic portion of the Patchawarra Trough which is known to have generated both oil and gas in close proximity to existing pipeline infra-structure.
For more information see www.greatoil.com.au
Posted by Richard Price, Editor, EnergyME.com
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