Australian Oil subsidiary Los Alamos Oil (LOA) has entered into a farm-in agreement for a leased area measuring 12.5km² in California, US.
Under the terms of agreement, LOA will pay 75% of the cost of a completed producing well to earn a 75% interest in the total leased area, which is located in Los Alamos, Santa Barbara County.
After the repayment of the cost of drilling and completing the well, LOA’s interest will reduce to 56.25%.
The firm will drill the well to a depth of 12,000ft in September 2011.
LOA has an option to farm-in into an additional 7.2km² area adjacent to the leased area.
