Energy company Santos has decided to acquire a 40% interest in the WA-488-P permit containing the Beehive prospect offshore Australia.

The decision follows Santos and Total’s request for Melbana Energy to extend the expiry of the options to acquire a share in the Beehive-1 exploration well in October 2019.

Meanwhile, Total E&P Australia Exploration has turned down its option to purchase a 40% interest in the permit.

As a result of Total’s decision, Santos’ option has been modified and it may now acquire an 80% interest in the permit in return for funding 100% of the costs for an exploration well in the permit area.

According to Melbana, if Santos does not agree to the new offer, it will retain a 100% interest.

Assessed by consultant expert McDaniel & Associates, the Beehive is estimated to contain a prospective resource of approximately 388 million barrels of oil equivalent (MMboe).

Melbana Energy chairman Andrew Purcell said: “Santos’ recently announced decision to acquire the northern Australian assets of ConocoPhillips , consistent with its aim to be a leading regional LNG supplier, make it a particularly exciting time for the energy sector in northern Australia.

“There is a great deal of interest from industry in these developments and we are confident that our Beehive prospect has a role to play there given other recent regional successes, its shallow water position close to existing infrastructure and the increased confidence in the prospect resulting from the newly processed 3D seismic survey acquired by Santos and Total.

“We look forward to continuing to work closely with Santos and are confident that other well-credentialed parties will have an interest in the Beehive prospect should the opportunity become available for them to participate in the drilling of this well.”

In July 2018, Melbana Energy commenced the acquisition of the Beehive 3D seismic survey in the country’s Bonaparte Gulf region through marine geophysical company Polarcus .