Beach Energy Ltd., through its subsidiary Beach Energy (Operations) Ltd. with support from its joint venture partner O.G. Energy, has inked a new offshore drilling agreement with Diamond Offshore General Co. on Aug. 17 for the use of the Ocean Onyx semisubmersible rig to undertake Beach’s Victorian Otway offshore drilling program.
The agreement provides for the drilling of up to nine wells (six firm and three options), with drilling operations expected to commence between December 2020 and March 2021, subject to extension, should certain conditions occur that impact on timing of commencement.
The first well in the drilling sequence is expected to be the Artisan 1 exploration well, followed by a series of development wells in the Geographe and Thylacine gas fields.
The agreement, which is at a globally competitive rig rate for deep water semisubmersible rigs, includes provisions for COVID-19 related costs and delays.
Concurrent with the signing of the agreement, Beach and Diamond have also signed a settlement agreement, which (following approval by the Bankruptcy Court) dismisses all current legal proceedings regarding the termination of the previous drilling agreement.
“We are pleased to constructively engage with Diamond and sign a new drilling agreement, in what has been a difficult time for the industry. It means Beach can move forward with its plans to develop additional natural gas supplies for the east coast gas market,” Matt Kay, Beach managing director and CEO, said.
The agreement remains subject to a number of conditions precedent, which are expected to be satisfied within the next few weeks.
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