Santos and its junior exploration partner Carnarvon Energy have struck a discovery believed to host 43 million barrels of oil east of Western Australia’s Dorado field.
In an update this morning, the companies said they'd found 46 metres of net oil about 3 kilometres below ground, using wireline data.
The discovery lies approximately 160 kilometres northeast of Port Hedland and around 46 kilometres east of the prominent oil and gas region, the Dorado field.
On the back of the find, the companies have assessed a resource for the northern culmination at the reservoir of 43 million barrels of oil, making it what is believed to be one of the largest oil discoveries made in Australia in recent years.
Broadly, the find could bolster the case for a final investment decision at the project - expected mid-2022 – and will aid in de-risking other oil and gas prospects within the wider Bedout Sub-basin area.
“The Pavo-1 success is expected to support a potential low-cost tie-back to the first phase of the proposed Dorado development, with Pavo north having an estimated breakeven cost of less than US$10 per barrel, and future gas production from the Bedout basin providing a source of supply into our existing domestic gas infrastructure in Western Australia,” Mr Gallagher said.
Mr Gallagher also said the oil and gas resources at Dorado and Pavo add to Australia’s national energy security, with oil and gas markets subject to increased volatility.
Pending a joint venture decision, Carnarvon managing director Adrian Cook said infrastructure was planned to be in place by the end of 2025.
“Today we announce another important oil discovery in the Bedout Basin, with high quality oil having now been recovered to surface from excellent quality reservoirs,” Mr Cook said.
“This discovery is material because Pavo lies only 46 kilometres from the proposed Dorado production facilities and is expected to be an ideal resource to tie back to Dorado.”
Carnarvon Energy shares were lifted on the news, last trading 14.06 per cent higher at 36 cents.
Santos shares were up 0.39 per cent to trade at $7.82.