West Perth-based petroleum explorer ARC Energy Ltd will farm-in to two Canning Basin permits owned by Nedlands-based oil and gas explorer Empire Oil & Gas NL after completing two geophysical surveys.
ARC has acquired a 5 per cent stake in both tenements after completing the survey, and currently holds the option of earning up to 75 per cent of each by undertaking additional exploration or spending $3 million on drilling in each of the tenements.
The full text of a company announcement is pasted below
Empire Oil & Gas N.L. ("Empire") was advised by ARC Energy Limited ("ARC") on 10 July 2007 that they have completed the recording of the two aeromagnetic surveys over each of the Empire operated EP 438 and EP 448 Exploration Permits located in the onshore Canning Basin, Western Australia.
The surveys consist of the onshore West Anketell Aeromagnetic Geophysical Survey of 8,000 line kilometres in EP 448 and the West La Grange Aeromagnetic Geophysical Survey of 3,000 line kilometres in EP 438. ARC are also in the process of reprocessing select seismic data within these two permits to further progress the identification of leads and prospects for future detail seismic or drilling.
Pursuant to the EP 438 and EP 448 Heads of Agreement entered into between ARC and Empire and the EP 438 and EP 448 permittees on 5 December 2006, ARC have exercised the option within the Agreements to farmin to each of the EP 438 and EP 448 permits. ARC will have transferred to it a 5% interest in each of the EP 438 and EP 448 Exploration Permits now they have completed the aeromagnetic surveys. ARC will now earn up to 75% in each permit by undertaking additional exploration of seismic and/or drilling by the expenditure of AUD$3 million in EP 438 and AUD$3 million in EP 448.
Maneroo Oil Company Limited, which holds a 60% equity in EP 438 and a 45% equity in EP 448, has reached agreement with Empire where Empire will acquire all of Maneroo Oil Company Limited's interest in each of EP 438 and EP 448. The Company looks forward to increasing its equity in these two Canning Basin permit areas and providing details of this acquisition.
This farmin with ARC complements the EP 104/R1 Farmin with ARC who are to operate and drill the Valentine-1 and Stokes Bay-1 wells in the Canning Basin, Western Australia, during August-September 2007.
