Tap Oil Farms Out Offshore Australia Acreage to JX Nippon
Tap Oil Limited announced that its wholly owned subsidiary Tap (Shelfal) Pty Ltd has entered into an agreement with JX Nippon Oil and Gas Exploration (Australia) Pty Ltd to farm-out a portion of its interests in Exploration Permits WA-320-P and WA-155-P (Part II).
The Palmerston gas prospect straddles these two permits and may be drilled as early as the first quarter of 2014. Tap will farmout 10% of its interest in WA-320-P and 7% of its interest in WA-155-P (Part II) in exchange for a 5% carry on the Palmerston well (up to a total well cost of US$70 million). Following the farm-out, Tap will retain a 9.778% interest in WA-320-P and a 6.555% interest in WA-155-P (Part II).
Tap’s Managing Director/CEO, Troy Hayden said:
“This transaction follows on from the equity swap in WA-320-P and WA-155-P (Part II) that provided us with access to the entire Palmerston gas prospect. This farm-out reduces our equity exposure in these permits and with the well carry, significantly reduces the cost of the well to Tap. The WA-320-P joint venture is looking at drilling the Palmerston prospect in early 2014.”
The transaction is subject to Foreign Investment Review Board approval and other approvals as are standard for transactions of this type. Subject to receipt of these approvals, the effective date of the transaction is 1 January 2013.