3D Oil announces additional funding from Beach Energy

THE ROADHOUSE BOWSER: 3D Oil (ASX: TDO) announced Beach Energy (ASX: BPT) has agreed to increase its funding of the expanded Flanagan 3D seismic survey in the T/49P permit in the offshore Otway Basin.

The Flanagan survey is now programmed to record 974 square kilometres of full-fold data, as opposed to the original 755sqkm permit commitment.

As a results Beach will earn an additional 10 per cent interest in T/49P by paying an increased share of the expanded Flanagan survey costs.

The T/49P joint venture will then be 3D Oil 70 per cent and operator, with Beach Energy at 30 per cent.

3D Oil said it intends to leverage the results of the Flanagan survey to attract the best possible farm-in terms for future exploration in this gas exploration area.

The company explained the current deal with Beach allows it to retain a large pre-drilling interest and operatorship in T/49P, while reducing cash exposure and at the same time acquiring additional seismic coverage over the targeted T/49P leads.

“The technical and commercial fundamentals of gas exploration in this area are very strong,” 3D Oil managing director Noel Newell said in the company’s announcement to the Australian Securities Exchange.

“We consider the fact that a large Australian operator like Beach Energy has increased its stake in T49P is a strong validation of the potential of permit.

“It is also gratifying that Beach has confidence in our joint venture and in TDO’s operatorship of the permit.”

Acquisition of the 974sqkm Flanagan survey is underway northwest of King Island and, subject to weather and sea conditions, is expected to be completed by mid-December.

Since acquiring the permit in May 2012 3D Oil has continued to expand its assessment of the prospectivity.

The company said the work has only enhanced its view that the permit potentially contains large gas volumes.

The Flanagan survey is designed to mature a number of leads in northern part of the block which are located adjacent to the neighbouring Thylacine and Geographe producing gas fields which have a combined gas in place (GIP) of over two trillion cubic feet (TCF).

Of particular note are the Whalebone and Flanagan leads which have a combined best estimate Prospective Resource of 7.8 TCF GIP.

Website: www.3doil.com.au