Cue Exploration has formed a joint venture (JV) with partner companies to test the Ironbark prospect in the exploration permit WA-359-P, offshore Western Australia.

The JV was created after all agreements between the Australian company completed and BP Developments Australia, Beach Energy and New Zealand Oil & Gas have been concluded. The agreements finalised include the BP Option Deed, farm-in agreements with Beach and New Zealand Oil & Gas, and the co-ordination agreement between all parties.

Now, BP is the operator of the WA-359-P Joint Venture with a 42.5% stake. Cue (21.5%), Beach (21%) and New Zealand Oil & Gas (15%) hold the remaining interests.

As a part of these agreements, Cue received around A$1.8m and will be funded by BP, Beach and New Zealand Oil & Gas for around $11m of well costs. An additional $8m has been allocated by Cue to fund the uncarried portion of its earlier agreed participating costs to drill the well.

The JV plans to drill the Ironbark-1 well in the exploration permit in late-2020. The well, the first test of the Ironbark prospect, is expected to be drilled to 5,500m.

Cue CEO Matthew Boyall said: “As previously announced, the Ocean Apex rig has been contracted and drilling is scheduled for late 2020.

“Cue holds a significant, 21.5% participating interest in the world-class Ironbark prospect, which has a best estimate 15Tcf of prospective recoverable gas and is close to existing LNG infrastructure.”

Exploration permit WA-359-P is situated in the Carnarvon Basin around 50km from the North West Shelf LNG infrastructure.

Cue noted that an Environment Plan for the Ironbark-1 well site survey activities has been accepted by the National Offshore Petroleum Safety and Environmental Management Authority (NOPSEMA). Survey operations are slated to begin in the third quarter of 2019.