Inpex, Apache buy BHP interest in WA oil fields

JAPANESE company Inpex and US company Apache Energy have increased their interests in two oil fields located near the Van Gogh oil project, which is due to start production in May.

Both companies have bought out BHP Billiton interests in permits WA-35-L, which excludes the defined Van Gogh area, and WA-255-P block 1801.

BHP spokesperson Samantha Evans said the company had been in discussions to sell the permits, known as the Coniston oil fields, for around a year. She would not reveal details of the sale.

The permits are located in the Exmouth Basin offshore Western Australia.

The sale boosts Inpex's interest in WA-35-L to 47.499 per cent from 28.5 per cent, while Apache will hold the balance, increasing its interest from 31.501 per cent.

For the WA-255-P Block 1801, Inpex agreed to buy a 23.7495 per cent interest while Apache bought BHP's remaining 26.2505 per cent stake. Woodside Petroleum holds the remaining 50 per cent interest.

Inpex and Apache plan to carry out appraisal drilling and said depending on results, some synergies may be found through the sharing of production facilities with the Van Gogh operation.

According to Apache, oil production at Van Gogh is estimated to peak at 63,000 barrels per day over a project life of between 12 and 15 years.

Product from the project will be sold to refineries primarily in South-East Asia, Japan and South Korea.

Apache, which is the operator of the project, has a 52.5 per cent interest in Van Gogh while Inpex holds the balance.

Meantime, Inpex said it remains committed to developing its $12 billion gas processing plant in Darwin, following comments from a Liberal senator who says otherwise.

Northern Territory Country Liberals Senator Nigel Scullion says the federal government's emissions trading scheme will force Inpex to move the plant offshore.

Inpex is currently carrying out the front-end engineering and design work for the project.

Last year, the Japanese company chose Darwin ahead of WA as the plant site, which will process gas from the Ichthys field.