Energy: $1.5bn Malaysian partner backs 3D Oil in the Gippsland Basin

3D Oil (ASX:TDO) has received a ‘shot in the arm’ after entering into a joint venture with $1.5 billion Malaysian oil and gas operator Hibiscus Petroleum Berhad to explore the promising VIC/P74 permit in the Gippsland Basin offshore Victoria.

The permit is adjacent to the Kingfish oil field, the largest oil field ever discovered in Australia that has, to date, produced over 1 billion barrels of oil.

VIC/P74 contains the Omeo gas and condensate discovery and may have the potential to host other significant hydrocarbon accumulations, 3D says.

The entry of Hibiscus, which operates projects in Malaysia, the UK and Australia, to take up a 50 per cent stake in the permit indicates that the Malaysian operator shares some of this belief.

Hibiscus and 3D are also partners in VIC/P57, which is close to a number of oil and discoveries such as West Seahorse, Seahorse, Wirrah, West Moonfish and Moonfish.

Shares in 3D Oil were up almost 4 per cent this morning on the news.

Initial work program requirements for the permit are modest and largely consist of the purchase of reprocessed 3D seismic data.

The company said that while previous exploration in the region had been hampered by technical issues, recent advances in seismic reprocessing techniques have substantially reduced their impact.

In other energy news today:

Metgasco (ASX:MEL) has upgraded the potential of its Perth Basin farm-in project following an independent review by RISC.

RISC estimated that the Cervantes prospect in the L14 licence area could host up to 17.4 million barrels of potentially recoverable oil, about 14 per cent higher than Metgasco’s internal estimates.

Metgasco can earn a 60 per cent interest in the Western Flank of L14 from Singapore-based Jade Energy by drilling one exploration well at its own cost in the period to the third quarter of 2020.

It also has the option to earn a 60 per cent interest in uncommitted areas of L14 by drilling a second exploration well in those areas by December 2020.

Otto Energy (ASX:OEL) has said that the Green #2 development well at its Lightning gas and condensate field in the Gulf of Mexico region is poised to start drilling this week.

The well is expected to take 60 days to drill and be completed for production in early 2020.