WHL Energy said that the Commonwealth – Victoria Offshore Petroleum Joint Authority has offered the Company the 2011 Australian Acreage Release block V11-2, which contains the La Bella gas field and several offset gas prospects and leads.
The Company has formally resolved to accept the offer and the block is expected to be gazetted in the next 2 months. Release block V11-2 lies in the offshore Otway Basin, approximately 200 km WSW of Melbourne off the Victorian coastline, WHL Energy will hold 100% equity in the block, WHL Energy said in a statement.
WHL Energy said that there were multiple bidders for the block and it has commenced farm-in discussions for the permit area after having previously received an early, formal farm-in offer for the block (subject to WHL Energy being awarded the acreage). The Company believes that the V11-2 release block was of considerable interest to the oil and gas industry given its proximity to existing development infrastructure, including the Santos operated Casino development, the Origin operated Otway gas project, the BHPB operated Minerva development and TRU Energy Iona gas plant.
The project is also well positioned to capture the anticipated growth in south east Australia gas demand arising from the growing impact of the expansion of LNG projects in Queensland and NSW, with many analysts forecasting that east coast gas pricing will ultimately move towards LNG netback pricing as export demand increases.
WHL Energy’s Managing Director, Mr Steve Noske , said the Company is confident the La Bella gas field will provide a significant return to the Company and its shareholders. “The Company believes it will be able to immediately book a 2C contingent resource of 158 PJ of gas and 1.2 mmbbls of condensate. Internal planning anticipates first commercial production is possible by early 2016,” Mr Noske said.
The block also contains a number of exploration leads, with relatively low risk prospects present at Highlander and West La Bella which provide additional tie-back opportunities to a potential La Bella development. Larger potential leads, albeit at higher risk, are also present within the La Bella area (Lowlander leads) and offer significant additional potential. A total unrisked mean/mid case Prospective Resource and 2C Contingent Resource of 668 PJ and 4.9 mmbbls of condensate are mapped in the vicinity of La Bella.
Commenting on the offer of the V11-2 block, Mr Noske stated: “The offer of V11-2 meets one of the Company’s key strategic priorities, being the capturing of ‘a line of sight to production’, and brings WHL Energy’s objective to become a production company within a foreseeable timeline. The Company’s plan is for the significant levels of revenue expected to eventuate from the development of La Bella from 2016 to further underpin the Company’s growth into Africa.
“This is a major coup for WHL Energy, a Company that until last year was best known as a wind energy proponent. Within the last 18 months the Company has acquired and rapidly advanced its large offshore oil and gas exploration interests off the coast of the Seychelles, participated in a winning JV bid for a high profile exploration permit off the Western Australian coast and has now been awarded a much sought after, proven, gas block on the eastern side of Australia. “The awarding of V11-2 demonstrates the Company’s ability to be a strong competitor, leveraging from its technical and commercial strengths. Furthermore it cements WHL Energy’s reputation as an organisation able to identify and capture acreage, thereby raising the profile of the Company as a future partner of choice amongst our peers.”
[mappress] LNG World News Staff, March 22, 2012; Image: WHL