Carnarvon Petroleum Limited’s (ASX:CVN) Buffalo oil field will now fall within Timor-Leste’s exclusive jurisdiction following the signing of a maritime border treaty between Australia and Timor-Leste.
The treaty provides that security of title and legal rights currently held by Carnarvon will be preserved through conditions equivalent to those already in place under Australian domestic law.
Adrian Cook, managing director, said: “We wish to congratulate the Australian and Timor-Leste Governments for establishing certainty over the maritime boundaries in the Timor Sea and for respecting the rights and interests of affected companies such as Carnarvon.
“We have established a positive and constructive working relationship with representatives from the ANPM and Timor-Leste Government and look forward to building upon this as we work to redevelop the Buffalo oil field.”
More certainty around Carnarvon’s redevelopment plans
The treaty finally determines each nation’s entitlement and ownership of the rich oil and gas reserves in the Timor Sea.
The Buffalo Oil Field was discovered by BHP (ASX:BHP) in 1996 and produced 20.5 million stock tank barrels of highly-undersaturated, light oil. Carnarvon secured the Buffalo Project in 2016.
Carnarvon will now continue to work with the authorities in Timor-Leste to have the required production sharing contract (PSC) in place once the treaty is ratified by Australia and Timor-Leste.
Meanwhile, the company may proceed with operation and preparatory activities for redeveloping the field prior to the ratification of the treaty.
READ: Carnarvon Petroleum’s improved data likely to take Buffalo oil field to development
The company recently received new data that shows increasingly clear definition around the producing reservoir in the Buffalo oil field.
The data further improves imaging at the Elang formation, which is the producing reservoir in the field off Western Australia’s northern coast.
A seismic image shows reservoir up-dip of the Buffalo-5 production well into an area Carnarvon expects will contain unproduced oil.
Aiming to progress the project to drilling and development
At this stage, the Carnarvon team believe the data set is sufficient to take the project forward to drilling and development.
The discussions held so far with officials from Timor-Leste make it clear Carnarvon and Timor-Leste are equally agreed to achieve first oil as soon as possible.
Importantly, Carnarvon believes there to be a number of benefits in developing the field within the Timor-Leste framework.