Triangle seals deal on Talon farm out agreement

WA-based oil producer Triangle Energy has signed a binding farm-out agreement with Talon Energy for two onshore gas permits in the Perth Basin after all conditions of the deal were met.

The transaction includes the first of two payments towards a 50 per cent share in the 3D seismic dataset known as “Bookara” which stretches across the two permits that were delivered in January. However, final interpretation, mapping and prospect evaluation of the data is ongoing.

The L7 permit is located south of Geraldton in WA and earlier work by the company indicates the acreage could hold a best case prospective resource of 617 billion cubic feet of gas. The Dampier-Bunbury gas pipeline runs through the tenure and its presence suggests any discovery could be readily dispersed to the wider market.

The second of Triangle’s farmed-out permits, EP 437 is an onshore basin positioned on the flank of the North Perth Basin and adjacent to the Dongara oil and gas field south of Geraldton in WA.

Triangle Energy Managing Director, Conrad Todd said: “We look forward to working with Talon’s management and staff, who are acknowledged to be leading experts in the Perth Basin and who share our vision on the prospectivity of these permits. We are keen to now progress our exploration plans to drill these exciting blocks in the Perth Basin together.”

Last year Triangle brought in $9.96 million after farming out 25 per cent of its L7 production licence and EP 437 exploration permit in WA to New Zealand Oil & Gas. The deal follows a similar agreement with Talon Energy last year and allows Triangle, who still retains a 50 per cent stake in the assets, to advance exploration in the zones via the newly formed joint venture.

The final outstanding condition of importance to the term sheet, the approval of new joint operating agreements for both permits, has been waived by Talon and Triangle until May.

The waiver will allow new joint venture farm-in partner New Zealand Oil & Gas sufficient time to join Talon and Triangle in drafting the new documentation.

As consideration for its 25 per cent interest in L7 and EP437, Talon will pay Triangle around $1.9 million towards past expenditure on the recently acquired Bookara 3D seismic data, with $1 million paid now and the balance of  about $900,000 paid prior to 1 September 2023.

The two permits were previously described as critical components in the company's efforts to recoup revenue through cleaner gas operations and reduce costs associated with decommissioning its offshore Cliff Head operations.

Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au