Australian oil and gas exploration and production company Santos has approved the A$490m ($505m) Finucane oil project in the Carnarvon Basin, offshore Western Australia. Santos will develop the project through a three-well subsea tie-back to its floating production, storage and offloading facility at the Mutineer-Exeter field.

Santos CEO David Knox said the development approval of Fletcher Finucane came barely six months after the discovery of the Finucane South field, reflecting a rapid transition from exploration to development.

"This is a great achievement and I would like to acknowledge the work of the project team and the joint venture partners, not only of Fletcher Finucane, but also Mutineer Exeter, in getting us to this point so quickly," said Knox.

Fletcher Finucane’s gross proved and probable reserves are estimated at 14 million barrels. First oil production is expected in the second half of 2013 at an estimated average gross production rate of 15,000bpd for the first 12 months.

Santos vice-president John Anderson said the project would extend the economic life of Mutineer Exeter by four years, and give the partners scope to pursue other opportunities in the area.

The firm increased its equity in the oil project by buying TAP Oil interests for $18m, as well as Tap’s project costs incurred since 1 July 2011.

Santos now holds an effective 48% aggregate interest in the Fletcher Finucane project and is its operator. Other participants are Kufpec Australia and JX Nippon Oil & Gas.