Karoon: Santos Basin Update
Tuesday 20 February 2018
Karoon announce a positive development in the FEED process for the Echidna light oil development proposal. In order to proceed to a Declaration of Commerciality on the Echidna and Kangaroo oil discoveries, Karoon has now received an approval for a variation of the existing work program.
The Board of Directors of the Brazilian oil and gas regulator, Agência Nacional do Petróleo, Gás Natural e Biocombustíveis, has:
I) approved Karoon Petróleo & Gás Ltda's application to review the Appraisal Plan relating to Santos Basin exploration blocks
S-M-1037, S-M-1101, S-M-1102, S-M-1165 and S-M-1166, thereby removing the appraisal phase commitments to drill two wells and acquire 3D seismic, in favor of progressing Echidna and Kangaroo to a future development phase; and
II) resolved to close the current Appraisal period.
Karoon will now present the Final Appraisal Report and submit a Declaration of Commerciality application on the areas it intends to retain to progress a future development.
Karoon has issued a Request for Tender to service providers for the proposed Echidna development. FEED is expected to be ongoing for the first half of 2018.
The approval to vary the work program and remove the drilling and seismic commitments in the Blocks, which represented a significant portion of the Group’s exploration and evaluation commitmments, provides greater certainty of the future development cost requirements and is positive for the current tender process and farm-out intentions.