- With all the necessary conditions now satisfied, Carnarvon Petroleum (CVN) has completed the farm-out of its Buffalo Project to Advance Energy
- According to a deal signed last year, Advance Energy would acquire a 50 per cent interest in Buffalo by funding the drilling of the Buffalo-10 well up to a value of US$20 million (roughly A$25.64 million)
- The finances have now been transferred into a joint bank account and drilling of the well is expected to begin later this year
- Once the drilling work has been completed, the two companies will form a joint venture to source additional funding from third party lenders
- Shares in Carnarvon Petroleum remained steady today, closing at $0.28 each
With all the necessary conditions now satisfied, Carnarvon Petroleum (CVN) has completed the farm-out of its Buffalo Project to Advance Energy.
According to a deal signed on December 17, 2020, Advance Energy would acquire a 50 per cent interest in Buffalo — located off the coast of northern Western Australia — by funding the drilling of the Buffalo-10 well up to a value of US$20 million (roughly A$25.64 million).
The finances have now been transferred into a joint bank account held by Carnarvon and Advance, and drilling of the well is expected to begin later this year.
Carnarvon is currently working to secure a drill rig for the work — a tendering process for which is already underway.
Once the drilling work has been completed, the two companies will form a joint venture to source additional funding from third party lenders. Carnarvon said the new structure is designed to take advantage of the strengthening oil market, which will be achieved by suspending the well as a future production asset.
“The Buffalo field has the advantage of being in shallow water which enables a low-cost project,” said Adrian Cook, Managing Director and CEO of Carnarvon Petroleum.
“This together with the certainty of the field’s historical production characteristics enables a fast track timetable and makes Buffalo an exciting project for Carnarvon shareholders,” he added.
Shares in Carnarvon Petroleum remained steady today, closing at $0.28 each.