Santos to take operatorship of oil and gas permit where NeuRizer holds 20% stake
Santos will earn a 50% interest in ATP 2023 and will undertake a three-well gas exploration program targeting the Toolachee Formation in Queensland’s Cooper Basin.
Emerging urea producer NeuRizer (ASX: NRZ) has unveiled a farm-in deal that will see major Santos (ASX: STO) earn a 50% stake and take operatorship of an oil and gas permit, which NeuRizer owns 20% of, in Queensland’s Cooper Basin from Bridgeport.
NeuRizer’s wholly-owned subsidiary Leigh Creek Oil and Gas has earned a 20% participating interest in ATP 2023 in the Cooper Basin under a farm-in arrangement with Bridgeport that was executed in February 2020.
In a separate deal, Santos has agreed to secure a 50% stake in the permit from Bridgeport and will operate a three-well gas exploration program targeting the Toolachee Formation.
Bridgeport is retaining a 30% interest in the permit.
NeuRizer managing director Phil Stavely said having an experienced operator such as Santos on board, highlights the prospectivity of ATP 2023.
“We look forward to undertaking the exploration drilling with Santos and Bridgeport and realising the potential for near-term gas production.”
According to NeuRizer, Santos has been “highly successful” targeting Toolachee Formation gas accumulations in surrounding permits and has identified ATP 2023 as having similar prospects.
NeuRizer also noted there was existing gas infrastructure a short distance from ATP 2023, which would reduce tie-in costs and connection time once a discovery has been made.
NeuRizer urea project
Formerly Leigh Creek Energy, NeuRizer is focused on developing its fully-integrated and carbon neutral urea production facility in South Australia.
NeuRizer says its namesake South Australian project is of national significance and it plans to generate a low-cost, high-quality nitrogen-based fertiliser for local and export markets.
Initially, NeuRizer will produce 1 million tonnes a year of urea from the project, and may expand this to 2Mtpa.
“Urea fertiliser is the building block of crop production across the globe and NeuRizer will be Australia’s first sovereign manufacturer of carbon neutral, nitrogen-based product for local and export agricultural markets,” Mr Stavely explained.
A final bankable feasibility study on the proposed operation is expected at the end of this year followed by an investment decision.