Sapura Energy Bhd, via its wholly-owned subsidiary Sapura Upstream Sdn Bhd, has signed three farm-in agreements for offshore exploration permits held by private Australian oil and gas company, Finder Exploration Pty Ltd.
Under the agreements, Sapura Upstream will acquire a 70% interest in the three exploration permits, and assume operatorship of the exploration, Sapura Energy said in a stock exchange filing today.
Finder, which is based in West Perth, will retain the remaining 30% interest in the permits. All three exploration permits are for locations within the North West Shelf oil and gas province off Western Australia, which Sapura Energy said is "highly prolific".
"Following the signing of the agreements today and subject to securing the requisite regulatory approvals, Sapura Upstream will acquire interests in blocks EP 483 & TP/25, WA-412-P, and AC/P 61," the group said.
The EP 483 & TP/25 permit is located in shallow water at the southern margins of the Carnarvon Basin and is close to infrastructure, while the WA-412-P permit is located in the northern region of the Carnarvon Basin and is adjacent to several large oil and gas fields. The AC/P 61 permit is situated at the Vulcan Sub-basin, where it is surrounded by oil and gas discoveries.
Via the farm-in joint venture, Sapura Upstream and Finders plan to drill two exploration wells in the Carnavon Basin permits between 2019 and 2020. It also plans to acquire seismic data in AC/P 61 in 2019.
"Both Carnarvon Basin permits contain high quality, drill-ready prospects offering significant upside potential," Sapura Energy said.
Completion of the farm-in agreements is subject to the parties securing the required regulatory approvals.
"Our entry into Australia marks another significant milestone for our upstream business as we continue to pursue growth in line with our strategy to expand our portfolio and acreage position," said Sapura Energy president and group chief executive officer Tan Sri Shahril Shamsuddin in the statement.
Shares in Sapura Energy closed 1.5 sen or 4.4% higher at 36 sen today, giving it a market capitalisation of RM2.16 billion. Compared to a year ago, the stock is down near 74%.