Triangle Energy cements north Perth Basin farm-out with New Zealand Oil & Gas

Triangle Energy (Global) Ltd has executed a binding farm-out agreement for New Zealand Oil & Gas Limited (NZO) to acquire a 25% participating interest in the L7 Production Licence and the EP 437 Exploration Permit in Western Australia.

After completing all confirmatory due diligence, NZO has decided to proceed with the deal for the properties onshore north Perth Basin encompassing the town of Geraldton and along the coast to the south.

The farm-out, which includes NZO paying a 50% share of the Bookara 3D seismic costs totalling A$1.9 million, is subject to customary regulatory approvals including DMIRS and FIRB.

Targeting highly prospective reservoirs

The exploration wells will target the highly prospective Early Permian-aged reservoirs identified by the Bookara 3D seismic survey, which are analogous to recent discoveries in adjacent permits, including Lockyer Deep, Waitsia, West Erregulla and South Erregulla.

TEG managing director Conrad Todd said, “I am pleased to report to shareholders that Triangle has completed the farm out of a further 25% interest in the L7 and EP 437 Permits.

"We are delighted to welcome New Zealand Oil & Gas, who have production interests in both New Zealand and Australia, to the joint venture.

"We are keen to now progress our exploration plans to drill these exciting blocks in the Perth Basin together.”

READ: Triangle Energy completes farm-out in north Perth Basin to New Zealand Oil & Gas

In addition to the upfront costs, and in line with a binding term sheet signed in January, NZO will fund an uplift on the costs of three exploration wells to be drilled in 2024.

Forecast expenditure on these wells is ~A$9.96 million, net to NZO, to be paid as costs are incurred.

The cost of all existing rehabilitation and restoration obligations for L7 and EP 437 will be borne exclusively by Triangle.

“Low-cost exposure”

NZO chief executive Andrew Jefferies says entry to the Perth Basin via farm in to L7 and EP 437 provided low-cost exposure to onshore prospects in an exciting area with joint venture partners the company knows well.

“With this farm in we are continuing to execute our board’s strategy. It’s great to be partnering with Triangle and Talon.

"These are companies that share a similar corporate and technical ethos with NZO and we will be working closely together to leverage our combined expertise to drive shareholder value through successful exploration.”

READ: Talon Energy executes Perth Basin farm-in with Triangle Energy

After completion, the permits’ joint ventures will comprise Triangle (50% and operator); NZO (25%) and, subject to completion of their own farm-out agreement, Talon Energy Ltd (ASX:TPD) (25%).

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