Santos at our doorsteps

Santos goes north Wednesday, 12 December 2012 SANTOS has made a further expansion into the outback, agreeing to take a 75% stake in four permits in the McArthur Basin in the Northern Territory for a potential $81 million. It will take the stake in exploration permits EP 161, 162, 189, and 299 (A) from UK-based Tamboran Resources, which cover a combined area of about 25,000 sq.km. Santos will immediately grab a 50% stake in the permits by agreeing to fund $41 million for a phase one program within three years, while it can grab a further 25% stake by agreeing to fund $30 million phase two program. This phase will include the drilling and testing of two wells. Santos has also agreed to take a 14% stake in Tamboran for $10 million. So far Tamboran has been targeting the Kyalla shale, the Velkerri, Yalco, Lynott, and Barney Creek formations. According to Tamboran, General fluorescence in cores taken at permits near EP 161 from the Kyalla while there have been several live oil shows in wells drilled in EP 161 and 162 from the Velkerri formation. Meanwhile, it also says that there have been continuing gas emanations from deeper formations at EP 162, with Tamboarn hinting at a gas in place figure of about 7 to 18 trillion cubic feet of gas. Vice president Western Australia and Northern Territory John Anderson said while gas was an attraction, the main game was liquids, and pointed to infrastructure as a draw. “There’s also the added attraction of their proximity to critical infrastructure like a major highway, gas pipelines and a railway,” he said. “The nearby Alice Springs to Darwin gas pipeline connects not only with major domestic users but also export markets.” The deal represents a further deal into the outback for Santos, which earlier this year agreed a potential $150 million farm into Central Petroleum permits in the Amdeus and Pedrika basins. It has also operated the Mereenie oil field in the Amadeus Basin since 1993. http://www.energynewspremium.net/StoryView.asp?StoryID=9643545