Red Sky acquired Cooper Basin licences PRLs 14, 17, 18, 180, 181 and 182, known as the Innamincka Dome projects, from Beach Energy earlier this year, with the licences containing the prospective Flax and Yarrow.
The new agreement will see Santos earn an 80 per cent interest and operatorship in the licences in return for a range of conditions, including that it fund 100 per cent of a 50 km2 3D seismic survey over the Yarrow field, as well as funding 100 per cent of appraisal wells in both the Yarrow and Flax fields.
If these operations prove satisfactory, Santos will initially fund 100 per cent of any approved development of the fields and will then be repaid for Red Sky’s share of expenditure out of its share in production.
Red Sky Managing Director and CEO Andrew Knox said the company was pleased to have Santos onboard.
“This partnership validates Red Sky’s strategy to develop high quality assets, which can be brought into production relatively quickly,” he said.
“The Red Sky Santos transaction is well timed to take advantage of the historically high AUD oil and gas prices in the current environment.”
Overall, Santos’ involvement is expected to inject around $9 million of capital into the project.
For more information visit the Red Sky Energy website.
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