MEO Australia has commenced farm-out process to secure funding partners to progress the technical assessment and drill the gigantic Beehive prospect in Bonaparte Basin, offshore Western Australia.
Beehive in permit WA-488-P is fully owned by MEO. It is potentially a multi-billion barrel, oil prone prospect in 40m water depth, next to the producing Blacktip field, according to MEO.
MEO said the recent seismic reprocessing and inversion project reinvigorated interest from major players. To date, four companies have engaged in the process and are actively reviewing the technical data for WA-488-P.
MEO is seeking responses from these potential farminees by the end of October 2016, but timing remains subject to ongoing market conditions and the addition of any new parties to the process.
“The Beehive prospect is one of the largest hydrocarbon structures in Australia and it is widely recognized that the recent seismic reprocessing and inversion have enhanced the characterization of the prospect,” said Peter Stickland, CEO and managing director, MEO.
Beehive is developable by a floating production storage and offloading vessel or pipeline. The Carboniferous age objective is an 180sq km isolated carbonate build up with 400m of mapped vertical relief, analogous to the giant Tengiz Field in the Caspian Basin.
This play type is new and undrilled in the Bonaparte Basin. Beehive is defined by a tight grid of pre-existing 2D seismic data, which MEO has reprocessed in order to further de-risk the prospect.
“In the current environment it is encouraging that four companies have actively engaged in the farmout process so far. MEO’s ambition is to bring parties into the WA-488-P joint venture to fund the advancement and ultimately drilling of Beehive,” Stickland said.
“Doing so would not only secure an exciting drilling opportunity for MEO shareholders, but enable MEO to focus its resources on its Cuba opportunities where it is the only ASX-listed company with exposure to the Cuban oil and gas industry.”
In Cuba, MEO identified three onshore oil plays in Block 9 containing 8.183 BBO with prospective recoverable resource of 395 MMbbl. The block is located on the north coast of Cuba, 140km east of Havana and along trend with the multi-billion barrel Varadero oil field.
Since acquiring 100% in the Cuban permit, MEO has been reducing its near term expenditure through farm-outs. In July, the firm granted Rouge Rock the option to acquire 45% interest in AC/P50 and AC/P51 exploration permits in the Vulcan sub-basin off the North West Coast of Australia.
These license areas are adjacent to a number of oil and gas discoveries, and are both currently 100% owned by MEO. The agreement will see Rouge Rock undertake and fund the remaining primary statutory work program for each permit consisting of seismic reprocessing and other technical activities.
This comes after MEO assigned its 50% interest in the WA-454-P exploration permit in the Bonaparte Gulf, offshore northern Australia to Origin Energy. MEO received AU$5.6 million in cash payments from Origin from the original farm-out agreement for WA-454-P in 2013-14.
The agreement includes provisions to effectively back-date the assignment to December 2015 as consideration for MEO’s 50% interest, allowing MEO to avoid all expenditure associated with WA- 454-P in 2016 and 2017. Following MEO’s assignment, Origin will have a 100% interest in the permit.
Subscribe
