Australian oil and gas producer Mosaic Oil has signed an agreement with Santos to acquire Santos’s interest in several production licenses with the associated pipeline licenses, production facilities, gas sales contracts and exploration permits in the southern Surat-Bowen Basin, Queensland.

According to the company, all production licenses, pipeline licenses and exploration permits involved in the transaction are currently operated by Mosaic Oil.

The oil company has said that the outright ownership of the Churchie and the Churchie West fields will allow the company to control the development of these fields. The current daily production from the interest being acquired is about two terajoules per day of gas and 25 barrels per day of oil/condensate.

Lan Nguyen, managing director of Mosaic Oil, said: The Surat-Bowen Basin is of vital importance to Mosaic Oil and this is a good deal for the company. Having full control of the Churchie Field extends our project pipeline potential.

The Churchie Field has only been partially developed and there is upside potential for Mosaic Oil to appraise and further develop the existing gas/condensate producing upper Tinowon Sandstone reservoir together with the proven but non-producing gas/condensate reservoirs in the Permian lower Tinowon Sandstone and Triassic Rewan Formation.