Apache and JX to join Carnarvon and Finder in Phoenix
Apache Corporation (Apache) from USA and JX Nippon Oil & Gas Exploration (JX Nippon) from Japan have seen their project of Farm-in Agreement with Carnarvon Petroleum Ltd (Carnarvon) and Finder Exploration (Finder), both from Australia, approved by the Australian Authorities.
Until then, the corresponding permits to these blocks were owned by a 50/50 joint venture between the Australian exploration companies Carnarvon and Finder.
Located in the shallow water of the Continental Shelf of the Northwest Australia, the blocks WA-435-P and WA-437-P stand approximately 150 kilometers offshore north of Port Hedland in Western Australia.
Carnarvon and Finder acquired these permits in 2009 and started exploration in following based on the Phoenix-1 discovery made in 1980.
The Phoenix South gas field belongs to the WA-435-P permit and lies in lower Triassic reservoir by 4,500 meter depth.
The Roc natural gas field is trapped in the same formation of this northern part of the Carnarvon basin but in the WA-437-P permit and only around 4,000 meter depth.
Neighboring the Phoenix-1 discovery, Carnarvon and Finder expect Phoenix South and Roc to hold several trillion cubic feet (tcf) of recoverable reserves of natural gas and billion barrels of oil equivalent in associated liquids.
From the last 3D seismic surveys, they should hold:
– Phoenix-1 0.9 tcf
– Phoenix South 5.5 tcf
– Roc 5.5 tcf
In respect with the previous discoveries and the potential size of the prospects, Carnarvon and Finder were looking for partners to bring in their expertise and financial resources to continue the exploration and envisage the future development of these gas fields.
To save future project capital expenditure in infrastructures to treat and export the natural gas and condensate, Carnarvon and Finder had interest in teaming up with companies having already assets in the Carnarvon and Browse basins.
Apache to become operator of Phoenix and Roc
According to the terms of the Farm-in Agreement, Carnarvon and Finder which were owning 50% each of the joint venture accepted to dilute their respective positions.
With the new joint venture set up between the partners, the working interests of the block WA-435-P and WA-437-P will be shared as following:
– Apache 40% becomes the operator for the further exploration and production
– JX Nippon 20%
– Carnarvon 20%
– Finder 20%
Apache and JX Nippon will contribute to the costs in respect with their share in the joint venture for the first well to be drilled in Phoenix South; then their financial contribution to the next drilling operations in Roc shall depend on the success of the first well.
In addition Apache and JX Nippon scheduled with Carnarvon and Finder the exploration and development program to be implemented with “reasonable endeavours” in order to monetize the natural gas and condensate at competitive costs and in a foreseeable future.
Through this Farm-in Agreement around the Phoenix and Roc fields in the blocks WA-4345-P and WA-437-P, Apache, JX Nippon, Carnarvon and Finder merge their respective expertise of the Carnarvon and Browse basins to speed up new gas fields development offshore Western Australia.