Johnson Winter Slattery has advised ASX-listed 3D Oil Limited on the Joint Operating Agreement that it has recently entered into with ConocoPhillips Australia (through an Australian wholly-owned subsidiary of NYSE-listed parent ConocoPhillips) in relation to the offshore Victorian petroleum exploration permit Vic/P79 located in the Otway Basin.
The Johnson Winter Slattery team advising 3D Oil comprised Peter Rose (Partner), Craig Wappett (Partner) and Tom Barrett (Special Counsel).
The execution of the Joint Operating Agreement satisfies a key condition of the Farmout Agreement for Vic/P79 that 3D Oil and ConocoPhillips Australia executed in June 2022, in respect of which our team also advised 3D Oil.
Under the terms of the Farmout Agreement, 3D Oil will receive a US$3 million cash payment in exchange for ConocoPhillips Australia acquiring an 80% interest in Vic/P79 and operatorship of the permit. In addition, 3D Oil will be carried on the drilling of an exploration well by ConocoPhillips Australia for up to US$35 million, after which 3D Oil will contribute 20% of the well costs in line with its joint venture interest.
Completion of the farmout of the 80% interest in Vic/P79 to ConocoPhillips Australia will occur following regulator approvals.
This is the second permit for which 3D Oil and ConocoPhillips Australia have entered into a joint venture, with the parties also being joint venture partners in the offshore Tasmanian petroleum exploration permit T49/P also located in the Otway Basin near to Vic/P79. The interests of 3D Oil and ConocoPhillips Australia in that joint venture are also 20% and 80%, respectively.
3D Oil has stated that the timing of the Vic/P79 exploration well coincides with other potential upcoming activity in the Otway Basin at a time when new gas supply to the East Coast market is critical. ConocoPhillips Australia has indicated that the purpose of its exploration activities is to identify gas reserves to supply into the domestic market and contribute to Australia’s energy security.