Oz Cue Wraps up Ironbark Agreements
An international consortium announced June 7 that it has agreed to kick off exploration at Australia's Ironbark offshore prospect.
Cue Exploration, BP Developments Australia, Beach Energy and New Zealand Oil & Gas have completed all agreements, resulting in the formation of a joint venture to drill the Ironbark-1 well in exploration permit WA-359-P, offshore Western Australia. The well is scheduled to be drilled in late 2020.
The agreements which have been finalised are the BP Option Deed announced October 2016, farm-in agreements with Beach and New Zealand Oil & Gas announced November 2017 and October 2018, and the Coordination Agreement between all parties announced October 2018, Cue said in a statement.
Under these agreements, Cue has received approximately A$1.8mn (US$1.26mn) and will now be funded by BP, Beach and New Zealand Oil & Gas for approximately US$11mn of Ironbark well costs. A further US$8mn of cash reserves has been escrowed by Cue to fund the uncarried portion of its expected participating interest cost for the well.
The WA-359-P joint venture participating interests are now: BP (operator) 42.5%; Cue 21.5%; Beach 21% New Zealand Oil & Gas 15%.
The BP, Beach Energy, Cue Energy Resources and New Zealand Oil and Gas joint venture was announced in October last year. Cue announced at the same time that BP would act as operator on Cue's behalf regarding planning for the Ironbark-1 well.
Ironbark is a prospect with an area of up to 400 km2 and a best technical estimate of 15 trillion ft3 of prospective recoverable gas resource based on an internal assessment performed by Cue. Moreover, it is less than 50 km from the North Rankin platform - which ties into North West Shelf LNG plant - and is also near the Pluto and Wheatstone LNG infrastructure.
Last month, Cue applied to Australia's National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA) for a geotechnical and geophysical site survey ahead of drilling at the Ironbark prospect.