Elixir Energy Ltd managing director Neil Young talked with Proactive about a newly signed farmout agreement with Xstate Resources Ltd covering the Diona sub-block of ATP 2077 in Queensland’s Bowen Basin.
Under the agreement, Xstate will earn a 51% stake in the Diona sub-block by fully funding the drilling of the Diona-1 exploration well, which is expected to spud in Q3 2025, subject to rig availability and other factors. Elixir Energy will retain a 49% interest and is fully carried through this initial well.
Young described the deal as “mutually beneficial”, noting the collaboration between technical teams and the strategic location of the drilling target: “Given the location immediately adjacent to an under-utilised gas gathering system, success could rapidly be converted into positive cash-flows.”
He also said that Elixir’s acquisition of ATP 2077 in 2023 was driven by its value to the Grandis Project, and that this farmout would meet most of the work commitments for the license.
The Diona-1 well will target a conventional gas structure near existing infrastructure, including a pipeline to the Wallumbilla Hub, enabling potential rapid commercialisation if a discovery is made. Elixir confirmed it retains full ownership of the Taroom Trough sub-blocks A and B, which are not part of this deal.
This agreement supports Elixir’s broader strategy to advance exploration in the Bowen Basin while leveraging external capital to manage risk and maintain upside exposure.
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