Falcon Oil & Gas Completes Farm Out Deal for Australian Unconventional Permits

Falcon Oil & Gas last week announced it has, through its local subsidiary, completed a A$20 million ($1.6 million) cash agreement with Origin Energy and Sasol Limited, with each of the two companies farming into 35% of Falcon’s exploration permits having unconventional oil and gas potential in the Beetaloo Basin, Northern Territory, Australia.

Together with A$20 million cash up front, the deal is worth up to approximately A$200 million ($186 million) to Falcon, the company said.

Origin and Sasol will carry Falcon in a nine well exploration and appraisal program over the next four years.

The two companies will pay for the full cost of completing the first five wells estimated at A$64 million. This drilling program will commence by mid-2015.

The next phase of four horizontal drilling will cost around A$100 million.

Philip O’Quigley, CEO of Falcon commented, “I am delighted to announce we have completed the Agreements with Origin and Sasol for our transformational Farm-out of our Beetaloo acreage. Together with A$20 million cash up front, the deal is worth up to approximately A$200 million to Falcon. We look forward to the immediate commencement of the nine well exploration and appraisal program.”