Oilex Ltd advises that all conditions precedent for the previously announced agreement to farmout part of its interest in the offshore block JPDA 06-103 in the Timor Sea to Japan Energy E&P JPDA Pty Ltd (Japan Energy) have now been satisfied.

Under the terms of the farmout agreement, Japan Energy, a wholly owned subsidiary of Japan Energy Corporation Ltd, will earn a 15% participating interest in the JPDA 06-103 Production Sharing Contract (PSC) from Oilex.

The consideration payable by Japan Energy under the Farmout Agreement includes both a refund of part of past costs, payable now and future funding for Oilex’s remaining 10% share of the costs for the first two commitment wells up to an agreed cap. Oilex will remain as Operator of the PSC.

Planning for the initial, two-well drilling program is well advanced and Oilex is currently in negotiation with a preferred contractor to secure a rig to drill the Loré and Lolotoe prospects. These prospects have estimated mean prospective resources (on 100% basis) of 195 million barrels of oil and 90 million barrels of oil respectively. Drilling may commence in fourth Quarter of this year.

Tags: Oilex