Central Petroleum Sees Exploration Starting by April
(Corrects third paragraph of story published on Nov. 6 to say that Total is funding 80 percent of exploration.)
“This area is considered to be highly prospective,” Richard Cottee, chief executive officer of Perth-based Central Petroleum, said in a phone interview.
Total, Europe’s third-biggest oil producer, will fund 80 percent of a $60 million stage one exploration program in the Southern Georgina Basin, Central Petroleum said in a statement. Total may commit a further 80 percent of as much as $130 million for stage 2 and 3 exploration should they proceed. That follows Statoil ASA (STL)’s agreement in June to invest as much as $200 million in a drilling program in the Northern Territory basin with PetroFrontier Corp. (PFC)
Shares of Central Petroleum, which have more than tripled since the start of the year, were at 19 Australian cents at 3:27 p.m. in Sydney trading.
The accord is subject to approvals from Queensland state and Northern Territory regulators and Australia’s Foreign Investment Review Board, Total said today in an e-mailed statement. Total has the potential to own as much as 68 percent of the four exploration permits and operate 90 percent of the acreage at the end of the program’s three stages, it said.
Central Petroleum doesn’t have a need for further funding after the Total agreement and another exploration partnership with Adelaide-based Santos Ltd. (STO) announced last month.
“The balance sheet is properly underwritten, and we don’t need to go to the market,” Cottee said.
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