Origin flags exit from upstream exploration beginning with Beetaloo basin

Origin Energy Ltd. will exit its Beetaloo basin interests in the Northern Territory and intends to divest all its upstream exploration permits in Australia.

The company agreed to sell all its interest in Beetaloo basin permits EP76, EP98, and EP117 it holds in joint venture with Falcon Oil and Gas to Tamboran Resources Ltd. for an upfront payment of $60 million (Aus.) plus a 5.5% royalty on future production from the permits.

The company also has executed an agreement to receive up to 36.5 petajoules/year of gas for 10 years on any production conditional on Tamboran taking positive final investment decision to develop the project and associated infrastructure.

Tamboran will assume Origin’s 77.5% interest and operatorship of the JV working the permits if not pre-empted by Falcon Oil and Gas, which holds the other 22.5% interest.

Origin has been exploring the Beetaloo in partnership with Falcon for 8 years. The permits contain successful unconventional shale gas finds in the Velkerri, Kyalla, and Amungee exploration wells.

The decision to divest interest in the Beetaloo and exit other upstream exploration permits over time will enable the company flexibility to allocate capital to grow cleaner energy and customer solutions, as well as deliver reliable energy through the transition, it said.

One of Origin’s other main upstream interests is in the onshore Canning basin of Western Australia where it partners with Buru Energy Ltd., Perth.

In response to Origin’s statement, Buru said it will consult with Origin over an orderly exit from the permits. Origin holds 50% and 40% interests in several permits with Buru, including the Rafael-1 gas condensate discovery in permit EP391.

Buru expects the process will take time to complete and that it will delay any field operations until the 2023 northern Australian dry season.

Origin’s divestments will have no impact on the company’s integrated gas business, including the company’s investment in Australia Pacific LNG at the Curtis Island plant.