The move follows the documentation approval by the National Offshore Petroleum Titles Authority

rig-2251648_640

The Exploration Permit T/49P is located in the eastern offshore Otway basin. (Credit: Kristina Kasputienė from Pixabay)

3D Oil wholly-owned subsidiary 3D Oil T49P has closed the sale of 80% stake in the Exploration Permit T/49P in the Otway basin offshore Australian state of Tasmania, to ConocoPhillips Australia.

The Exploration Permit T/49P, which covers an area of 4,960km2, is located in the eastern offshore Otway basin, west of King Island.

The latest move follows the documentation approval by the National Offshore Petroleum Titles Authority (NOPTA). ConocoPhillips will now operate the permit with 80% stake.

ConocoPhillips to undertake 3D seismic survey at T/49P permit

As per the farm-out agreement, 3D Oil will receive A$5m ($3.4m) cash payment for the previous permit expenditure. ConocoPhillips will undertake the acquisition of 3D seismic survey of at least 1580km2 within the permit and at no cost to 3D Oil.

Following the completion of the acquisition, processing and interpretation of the 3D seismic survey, ConocoPhillips Australia will have an option to drill an exploration well with an investment of up to A$30m ($20.7m).

In a press statement, 3D Oil said: “While global conditions are very challenging the potential for gas commercialization in Eastern Australia are very promising. TDO believes these conditions create opportunities for the company to exploit.

“The company is firmly focused on becoming a supplier to the burgeoning East Coast Gas market at a time of unique dynamics in local and global gas markets.”

Last year, ConocoPhillips has agreed to sell its northern Australia assets and operations, which includes its stake in the Barossa project and the Darwin LNG facility, to Santos in a deal worth $1.39bn.

As part of the deal, ConocoPhillips will be paid $75m after a final investment decision is taken on the Barossa development project in which it has an operating stake of 37.5%.

The assets considered for sale have jointly produced around 50,000 barrels of oil equivalent per day (MBOED) in the first half of 2019.