Santos has signed an agreement with Oil Search and ExxonMobil to acquire 20% interest in a highly prospective gas-rich acreage located in the highlands province of Papua New Guinea (PNG).
The petroleum prospecting license (PPL) 402 covers an area of 510sq km, and is approximately 40km northwest of the Hides gas field and production facilities.
The farm-in will result in Santos participating in the recently spudded Muruk 1 exploration well, targeting the Toro formation.
This reservoir is gas bearing in the nearby Hides and Juha fields, and is expected to have a mean gas resource of about 2 Tcf at a proposed depth of approximately 3450m.
Santos managing director and CEO Kevin Gallagher said the agreement demonstrates their commitment to grow in PNG and working with long-term partners, Oil Search and ExxonMobil.
Oil Search managing director Peter Botten said this transaction is consistent with the company’s strategic approach of working with selected partners to balance risk, while holding appropriate participation levels in opportunities that have the potential to add material gas resources to the company’s portfolio.
Post farm-in, operator Oil Search will retain its 37.5% interest while ExxonMobil retain its 42.5% interest.
In October 2016, Santos agreed to sell its natural gas assets in South Australia to Cooper Energy for AU$82 million.
The deal comprises 50% interest in the Casino-Henry gas project; 50% interest in the Sole gas field and the Orbost gas plant; 10% interest in the Minerva gas field and gas plant; and 100% interest in the Patricia-Baleen gas field.
Image: Map of PPL 402 / Santos
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