Update on Derby Block
Derby Block - Status
OBL holds a 50% interest in application for 5/07-8EP ("Derby Block") situated in onshore Canning Basin and is the designated operator CSG and USG/USO.
The Company advises that all submissions from stakeholders have on 21 December 2013 now been received by the National Native Title Tribunal ("NNTT") and the Company expects a formal determination by the NNTT under section 35 of the Native Title Act allowing possible award of the permit later this month.
As operator, the Company has submitted to the NNTT a comprehensive work program (including the shooting of a 500 line km 2D seismic survey) during 2013 - refer to Figure 1.
The Company also advises that on 21 December 2012 it formally advised its joint applicant Backreef Oil Pty Limited ("Backreef") that in OBL's opinion Backreef was in breach of its commercial undertakings with OBL in its proposed sale of its 50% application interest and all other rights in the Derby Block to a third party and consequently the Company intends to fully pursue its rights.
Following the NNTT decision, the finalisation of the formal grant of 5/07-8EP by the Minister and the WA Department of Mines and Petroleum ("DMP") is expected to occur shortly thereafter.
Fortescue Share Subscription Agreement - Status
Further to the OBL ASX Announcement of 15 November 2012, OBL advises that on 14 January 2013 discussions on the Letter of Intent were terminated by Fortescue Metals Group Limited (ASX code FMG), despite OBL having since early December 2012 signed-off on all documentation to effect this deal. However, FMG advised OBL that they remain interested in direct acquisition of part of the Derby Block subsequent to grant.
While OBL is disappointed with FMG's decision not to proceed with both the non-binding share placement and non-exclusive 25% earn-in to the Derby Block, the Company wishes to advise the market the following:
- The Company believes that the Derby Block is an attractive and highly prospective Fitzroy Trough permit for the extension of the potentially liquids-rich Laurel shale formation basin-centred USG/USO play delineated nearby in the east; well-situated to nearby to established infrastructure and the proposed future route of the Great Northern Gas Pipeline linking to large established WA domestic gas markets to the south, which will likely travel along the Great Northern Highway (Figure 1) which crosses the southern portion of the permit.
- OBL is presently fielding serious third party interest from an oil & gas exploration company in a similar transaction which may include a participation in a proposed placement.
- OBL has received renewed expressions of interest from oil & gas supermajors for a farm-in to the Derby Block should OBL attain 100% of the permit.
View the complete Oil Basins announcement at the link below:
About Oil Basins Limited
Oil Basins Limited (ASX:OBL) is engaged in the investment in selected exploration production and development opportunities in the upstream oil and gas sector. Oil Basins Limited was listed on the ASX on 23 August 2006 and is involved in exploration for oil and gas initially in the offshore Gippsland Basin waters of south-eastern Australia and the onshore Canning Basin of Western Australia. Since listing the Company has increased its leverage across all of its assets and has increased its exposure to attractive and prospective areas with the Canning Basin.
Oil Basins Limited