Oilex (ASX: OEX) has been awarded a large 11,400 square kilometre Special Prospecting Authority in the onshore Canning Basin that is prospective for oil and liquids rich gas.
It said the SPA-0055 represented a low cost – at $0.25 per acre based on its proposed work program – and low risk entry into one of Australia’s premier emerging unconventional basins.
The SPA may also have similar geological characteristics to Oilex’s Cambay Field in India, which would allow it to leverage its technical experience.
It also covers a previously overlooked half graben, identified by Oilex from vintage seismic data, which may be prospective for a petroleum system.
Oilex is preparing to conduct a six-month, low-level work program from the third quarter of 2013 to assess its prospectivity for hydrocarbons.
This program includes gravity/magnetic data acquisition and interpretation and is planned to commence at the conclusion of the expedited Native Title Notification Period of four months.
Upon completion of the work program, Oilex then has a further six months to negotiate the forward work program for the Petroleum Exploration Permit derived from the SPA.
The company has also submitted bids on gazettal blocks L12-08 and L12-09 that cover a 6,444 square kilometre area immediately adjacent to SPA-0055.
The additional acreage is interpreted to contain an extension of the play to the north of SPA-0055, potentially capturing an entire newly-defined play fairway.
Oilex had almost $7 million in cash as of 31 December 2012.
The onshore Canning Basin is widely regarded as a highly prospective unconventional oil and gas play.
The U.S. Department of Energy had in 2010 assessed the Goldwyer Shale that is present in much of the Basin as hosting Risked Recoverable Resources of 229 trillion cubic feet of gas.
Separately, Buru Energy (ASX: BRU) has drawn on its drilling and exploration activities to estimate that its permits could host 47Tcf of gas within the Laurel Formation as a Basin Centred Gas System, which could also contain almost 1.2 billion barrels of condensate.
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