Oilex Expands in Australia
Oilex has signed a binding term sheet to acquire fellow Australian operator Senex’s position in 27 petroleum retention licences in southern Australia’s onshore Cooper-Eromanga basins.
The Northern Fairway licences span 2,445 km2 and comprise permits covered by a 792-km2 seismic survey obtained by Senex in 2012. Senex will transfer 100% of the licences to Oilex pending government approvals and other conditions being met, Oilex said in a statement on September 27.
Government technical data indicates that the Northern Fairway licences hold shallow Jurassic oil and deeper Triassic and Permian oil and wet gas leads and prospects, according to Oilex. They also contain an undeveloped tight gas discovery. The licences come under a 15-year tenure retention agreement between the Southern Australian government and Senex reached in 2013.
In a statement, Oilex’s managing director Joe Salomon drew attention to the commercial potential of the Paning tight gas discovery and the company's experience in drilling and appraisal this unconventional resource.
“Equally, robust gas pricing in Eastern Australia provide a great basis for the commercial potential for the Paning discovery,” he continued. “The basin is well endowed with infrastructure providing for attractive low-cost discovery and development for Oilex.”
Oilex pay Senex only a symbolic A$1 ($0.70) per licence under the deal. It will also commit to covering existing abandonment liabilities and licence renewal fees, as well as meeting expenditure targets. However, Oilex noted that the permits were currently suspended by the government, putting annual licence fees and work obligations on hold. It intends to continue the suspension "for a period."
Oilex’s main focus is in southeast Asia, where it operates fields in India, Indonesia and East Timor. It is eager to expand its business, reaching an agreement to buy two licences in the Cooper-Eromanga basins in August, followed by a deal to obtain two UK licences in the East Irish Sea earlier this month.