(Asia-Pacific) - Beach Petroleum Ltd. is widening its exposure to offshore gas exploration in Australia by significantly increasing its stake, via farm-in, in acreage in far west Victoria.
The company has reached an agreement with Essential Petroleum Resources Ltd. to acquire a further 32.5% interest in Otway basin exploration tenement VIC/P46, which covers a large slice of offshore waters near the coast between Portland, west to the border with South Australia.
The acquisition would increase Beach's equity in the permit to 50% from 17.5% previously.
Beach says it would take over the operatorship of the block and drill the first well next year.
Essential has retained a 25% interest in the tenement, but has given up the operatorship.
Mitsui & Co Ltd. subsidiary, Mittwell Energy Resources Pty Ltd., holds the remainder 25% of the block.
"The acquisition provides Beach with a more substantive entry into western Victoria's offshore gas potential," says Managing Director Reg Nelson.
"It also brings added balance and spread of risk across our suite of production and exploration assets primarily in the onshore Cooper Eromanga Basin, the Tipton West coal seam investment in Queensland and the producing Basker Manta oil development project in the Gippsland Basin area of Bass Strait.
"VIC/P46 has several large mapped gas prospects. The largest prospect, Fermat, has the potential to be twice the size of the recently commercialized Casino gas field to the east and just offshore from Port Campbell.
"Fermat has the capacity to hold in excess of 1 tcf of gas.
A commercial gas discovery would have a distribution outlet through a grid connection to the main SEAGAS pipeline north of Portland, or to the eastern states' network via existing connections around Warrnambool.
Beach is already participating in offshore production through its 50% ownership of the Basker-Manta project in the Gippsland basin area of Bass Strait in eastern Victoria.
The second tanker load of crude oil of more than 410,000 barrels, of which Beach is entitled to half, is due to leave the Basker field on March 27, amid the current four-well development drilling program on Basker-Manta.
Beach Petroleum has also participated in drilling in the Carnarvon basin, offshore Western Australia.
This area will again be targeted, along with the Canterbury basin offshore on the eastern side of New Zealand's South Island, within the next 18 months.