Perth-based oil producer Triangle Energy Global has filled its coffers to the tune of $9.96 million after farming out 25 per cent of its L7 production license and EP 437 exploration permit in WA to New Zealand Oil & Gas.
The deal follows a similar agreement with Talon Energy in December last year and allows Triangle, who still retains a 50 per cent stake in the assets, to advance exploration in the zones via the newly formed joint venture.
Management believes both L7 and EP 437 could host a considerable amount of gas and plans to unlock the site’s potentially laden resources with a trio of new exploration wells in 2024.
L7 is positioned south of Geraldton in the Perth Basin and earlier work by Triangle suggests the zone holds a best-case prospective resource of 617 billion cubic feet of gas in five features alone. The allure of L7 is also linked to the site’s relationship with the Dampier-Bunbury Natural Gas Pipeline which runs through its tenure. The pipeline is one of the state’s most critical pieces of infrastructure in terms of energy and carries natural gas to customers across the state. It is the country’s longest natural gas pipeline at over 1500km and L7’s proximity to asset means a potential discovery could be readily dispersed to WA-based customers.
The second of Triangle’s recently farmed-out permits, EP 437 is an onshore basin positioned on the flank of the North Perth Basin and runs adjacent to the Dongara oil and gas field in Geraldton, WA.
To eliminate exploration risk associated to drilling in L7 and EP 437 the company purchased a suite of 3D seismic data known as “Bookara” which covers the two permits. Triangle believes merging the data with its existing information could deliver a better understanding of the area’s regional prospectivity and ultimately drive discovery.
To claim 25 per cent of the two permits New Zealand Oil & Gas will pay $9.26m to Triangle with $1.9 million of the outlay funding costs associated to the Bookara dataset and $6.56 million related to the drilling costs of two planned holes in L7. Another $1.5 million has been allocated for a well in EP 437.
The two permits were previously described as critical components in the company's efforts to recoup revenue through cleaner gas operations and reduce costs associated with decommissioning its offshore Cliff Head operations.
Triangle Energy Global Managing Director Conrad Todd said:"We are delighted to welcome NZO, who are an international company, based in Wellington, listed on the ASX, who have both Australian and International exploration and production. We look forward to working with NZO’s management and staff in conjunction with those of Talon Energy who share our vision on the prospectivity of these permits. We believe we have a well-aligned Joint Venture who are keen to now progress our exploration plans to drill these exciting blocks in the Perth Basin.”
After tying down yet another farm-in deal for its L7 production licence and EP 437 exploration permit Triangle says all costs associated to purchasing and processing the Bookara 3D seismic dataset have now been restored. In addition, the oil producer states nearly all of the $18 million required to plunge three holes across the tenements has now been recouped.
Triangle argues its newly formed joint venture boasts three technically capable and well-funded partners who are eager to develop the potentially gas rich WA acreage. The market will no doubt be keen to see what the new partnership can produce over coming months.
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