HiRex Petroleum Sdn Bhd, a joint venture between Rex South East Asia Ltd, a wholly-owned subsidiary of Rex International Holding Limited in Singapore, Orient Hibiscus Sdn. Bhd., a wholly-owned subsidiary of Hibiscus Petroleum Berhad, Triax Ventures Corp and a minority shareholder, is pleased to announce that it has signed a non- binding Heads Of Agreement (“HOA”) involving 3D Oil Limited, and Carnarvon Hibiscus Pty Ltd (“CHPL”).
The HOA accords an option from 3D Oil to HIREX to acquire a 20 per cent working interest in the approximately 448 square-kilometre concession VIC/P57, located in the northwest offshore oil-prolific Gippsland Basin (“VIC/P57 Option Interest Transfer”). In return, HIREX will apply the Rex Virtual Drilling liquid hydrocarbon detection technology to determine the best hydrocarbon prospects in the concession. The option has to be exercised within three months from the date of execution of the VIC/P57 Option Agreement between 3D Oil and HIREX. Exploration drilling in the concession is expected to commence in the first half of 2015.
The parties are targeting to sign a set of binding agreements within 40 days of the HOA, which will then be subject to, among other conditions, 3D Oil’s shareholders’ approval.
Upon the completion of the VIC/P57 Option Interest Transfer and other transactions under the HOA, the eventual participating interests of the parties would be CHPL 55.1 per cent; 3D Oil 24.9 per cent; and HIREX 20 per cent.
HIREX is very encouraged with the option interest in the VIC/P57 concession located in the Gippsland Basin which is known to be the most oil-prolific offshore basin in Australia. Using the RVD technology in the vast VIC/P57 concession, which has multiple highly prospective exploration prospects, will allow the VIC/P57 partners to assess the best exploration prospects. RISC Operations Pty Ltd engaged by Hibiscus Petroleum in 2012, has estimated
unrisked prospective resources at P(50) of 11 million barrels of oil at the Sea Lion prospect, which is part of VIC/P57. Other exploration prospects in VIC/P57, including Felix, may provide further upside to the concession. Please refer to Figure 2 for a map view of VIC/P57.
Mans Lidgren, CEO of Rex International Holding Limited, said, “We are very pleased that our proprietary Rex Virtual Drilling technology is a key contributing factor to HIREX’s participation in the VIC/P57 concession, indicating an increased acceptance of our ground-breaking technology among exploration and production players around the world. HIREX’s entry into Australia as its first project reflects the versatility of Rex Virtual Drilling, which can be applied in different geologies, geographies and applied to both onshore and offshore liquid hydrocarbon exploration.”
Pascal Hos, Chief Operating Officer of HIREX, said, “The Gippsland Basin is known to be oil- prolific. With high quality 3D seismic data available over most of the concession, and the proven high hit rate of Rex Virtual Drilling in detecting hydrocarbons, we are excited about the prospects in VIC/P57. We are also reviewing other business opportunities in Southeast Asia and will make announcements on these as and when there are material developments.”
VIC/P57 is approximately 448 square kilometres in size and covers a geologically diverse area of the Northern Terrace and the Central Deep areas of the offshore Gippsland Basin. The Gippsland Basin is the most productive hydrocarbon province in Australia, with initial resource estimates of more than 4 billion barrels of oil and condensate reserves and 9.8 trillion cubic feet of gas reserves. It has produced approximately two-thirds of Australia’s cumulative oil production and one-third of its gas production to date.
Exploration for oil and gas assets in VIC/P57 will benefit from the 2003 Northern Margin 3D seismic survey which covers approximately 70 per cent of the permit, revealing an array of prospects and leads.