Origin to acquire stake in Cooper-Eromanga gas blocks in Australia

Origin Energy has signed two farm-in agreements with Senex Energy to acquire exploration interests in the Cooper-Eromanga basin, Australia.

Origin will acquire a stake in two unconventional gas blocks which cover an area of around 1,900km in the basin. The two gas blocks comprise numerous prospective sub-basins, which include Allunga, Nappamerri and Patchawarra troughs. These are expected to provide exposure to multiple unconventional play types such as tight sands, shale and deep coal seams.

Origin plans to invest approximately $97m for a stage one exploration programme on each gas block, following completion of the farm-in agreements, which is expected by around June.

Origin will hold a 40% participating interest in Area A and a 30% participating interest in area B, upon completion.

At stage two, Origin will have the option to increase its stake in both blocks by 10% through contributing an additional $72m to a pilot appraisal programme in each area.

Senex will retain operatorship of Area A and Area B, while Origin will define the technical inputs to the work programme.

Origin Energy upstream CEO Paul Zealand said that the farm-in agreements represent an attractive opportunity through which the company can increase its upside exposure to unconventional gas opportunities in one of the most prospective gas regions in eastern Australia.

"Through Origin’s longstanding investment in the Cooper Basin Joint Venture, we have gained a detailed understanding of gas exploration and development potential in the Cooper-Eromanga region," Zealand added.