France’s Total Farms Into central Australian Shale Gas Acreage
French major Total has become the latest industry heavyweight to take a foothold in the nascent Australian shale gas sector, striking a deal worth up to $190 million with Central Petroleum to farm into four exploration permits in the South Georgina Basin.
Three of the permits, which cover about 25,000 sq km (9,652 sq miles) in central Australia, are located in Queensland and one is in the Northern Territory.
Under the terms of the agreement, Total will commit $48 million to the joint venture’s exploration and appraisal over the first four years, with Central paying $12 million, the Australian company said in a statement Tuesday. Total has the option to invest another $130 million in stages two and three of the project, which would earn it an equity stake of 68% in the four permits.
Central is to retain operatorship of the permits for the exploration activity, but at the end of the three stages, Total would assume operating responsibility for 90% of the acreage. The remaining 10% would stay under Central’s responsibility.
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