Senex Energy (ASX: SXY) has reached a 15 year petroleum retention licence scheme with the South Australian Government over 10,000 square kilometres of oil exploration permits in the Cooper-Eromanga Basin.
The scheme, which has an initial five year term and provisions for two further five year terms, allows the company to convert petroleum exploration licences to petroleum retention licences.
Notably, it replaces tenure specific expenditure obligations with a portfolio-wide oil exploration and appraisal expenditure target enabling efficient and targeted investment.
This increases operational flexibility and provides planning and expenditure certainty for Senex, which is planning to carry out about $30 million of exploration and appraisal expenditure each year.
While its still early days, the scheme’s success could see it extended to other oil and gas operators in South Australia.
Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX “Small and Mid-cap” stocks with distribution in Australia, UK, North America and Hong Kong / China.