3D Oil Awarded VIC/P79 Exploration Permit, Otway Basin

Source: www.gulfoilandgas.com 2/4/2022, Location: Not categorized

3D Oil Limited has announced that the National Offshore Petroleum Titles Administrator (“NOPTA”) has awarded the Company the VIC/P79 exploration permit in the offshore Otway Basin, referred to as V20-1 in the 2020 Offshore Petroleum Exploration Acreage Release.

The 2,576 km2 permit is located adjacent to the largest gas fields in the offshore Otway Basin, Thylacine and Geographe, and contains the highly prospective Vanguard Prospect. An exploration well commitment during the first three years of the work program demonstrates the Company’s high confidence in the potential of Vanguard and aligns with planned drilling activities in the basin.

The acquisition of a DHI (Direct Hydrocarbon Indicator) supported prospect situated within the proven gas fairway of the region greatly upgrades the Company’s position within the Otway Basin. The basin has witnessed a 100% success rate for almost two decades due to the identification of DHIs. The permit adds to an already strong portfolio of leads and prospects in the area that will likely further grow after the processing and interpretation the Sequoia 3D Marine Seismic Survey (MSS), recently acquired in nearby T/49P (owned 20% TDO) by operator ConocoPhillips Australia (COPA).

The work program for VIC/P79 was designed to rapidly exploit existing opportunity in the permit via one exploration well at Vanguard Prospect in Permit Year 3, after the reprocessing, merging and interpretation of 630km2 of existing 3D seismic data. Reprocessed data will also support geological and geophysical studies of additional leads already identified. The Secondary Term will focus on adding additional value by exploring the large, underexplored region to the west. This will be achieved by acquiring and processing 1000km2 of 3D seismic data in Permit Year 5 with the intention of searching for additional closures.

Exploration permit VIC/P79 covers a large area with little exploration drilling. Areas to the west of wells Nautilus-A1 and Triton 1 are constrained by 2D seismic data with varying quality and there are no exploration wells. Based on in-house regional technical evaluations of the Otway Basin, this area may also host prospective reservoir and seal sections. 3D seismic data in this area will assist with defining any viable closures that may complement a discovery at Vanguard Prospect.

Vanguard Gas Prospect

Vanguard is an east-west trending tilted fault-block trap located on the eastern side of VIC/P79, approximately 5km northwest of Geographe Field, between the Geographe gas field and La Bella gas discovery. Seismic interpretation shows the structure hosts reservoir sands of the Shipwreck Group, which are likely to have good reservoir characteristics based on adjacent offset gas fields, Geographe and Thylacine.

Vanguard is constrained by the La Bella and Investigator 3D seismic surveys, which form the basis for the Prospective Resource evaluation presented herein. DHIs have been observed on the Investigator 3D MSS from three stratigraphic levels across the structure, ranging in depth from approximately 2200-2400mSS. Vanguard boasts a strong amplitude response, and potential Amplitude Variation with Offset (AVO), which is common to adjacent gas discoveries and producing fields and can indicate the presence of hydrocarbons. In fact, these gas signatures have been identified on 3D seismic data across most offshore Otway Basin gas discoveries throughout the last two decades.

On the Investigator 3D MSS, potential flat spots are observed at multiple levels within the Waarre section and may represent hydrocarbon-water contacts. Reprocessing and merging of the La Bella and Investigator 3D surveys will allow for detailed prospect scale mapping, depth conversion and evaluation of DHIs.

The prospective resource estimates for VIC/P79 are shown in Table 1. Additional leads including Labella SW and Labella East add further uplift should Vanguard prove successful. During the secondary work program, 3D Oil will attempt to add even further value by searching for additional targets in the western, under-explored sections of the permit.

Commercialising a Vanguard Discovery

The prospective resource estimates at Vanguard indicate that the prospect is an economic candidate for tie-in to existing infrastructure or a standalone development. A discovery at Vanguard Prospect on the accelerated work program would represent opportune timing with respect to current gas market fundamentals as well as ongoing activities in the basin.

The Australian Energy Market Operator (AEMO) states that gas production in the Otway Basin is rapidly falling. Declining gas supply in the region is resulting in high gas prices that are likely to be sustained as reserves continue to decline. This has resulted in a significant uptick in exploration in the region, including the discovery of gas at Annie by Cooper Energy in 2019, followed by Beach Energy’s discoveries at Enterprise and Artisan.

Opportunity within the domestic gas market has been recognised by ConocoPhillips Australia who acquired 80% interest in 3D Oil’s T/49P exploration permit in 2020. Recently, ConocoPhillips completed the acquisition of the Sequoia 3D MSS on behalf of the Joint Venture. It is hoped that this data will add further prospects to 3D Oil’s growing seriatim in the offshore Otway Basin. The acquisition of VIC/P79 compliments our Otway Joint Venture in T/49P.

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