Tamboran becomes Beetaloo’s biggest player

It’s been a big week in the Northern Territoy’s Beetaloo Basin as Tamboran Resources made a series of significant business moves.

In the space of a few hours on Monday, Tamboran Resources went from being one of a number of players developing the Beetaloo Basin to the prospect’s Big Kahuna.

Tamboran’s purchase of 100 per cent of Origin’s assets means it is now the largest explorer at Beetaloo, with an estimated 92 per cent or 4.1m acres of the 4.5m acre reserve.

Tamboran now owns 77.5 per cent of the three fields purchased from Origin and Falcon Oil & Gas Australia has 22.5 per cent.

The company also signed its first customer. Origin, the country’s largest gas buyer, inked a 10-year agreement with Tamboran to purchase 100 terajoules a day from Beetaloo, as well as a wellhead revenue agreement based on a 5.5 per cent royalty payment.

Tamboran also released details of its $190m capital raising with more than $100m sourced from strategic US investors, including $30m from its main shareholder Parsley Energy billionaire Bryan Sheffield, who has an acute interest in shale gas projects.

Origin Energy's Kyalla well gas site near Daly Waters in the Northern Territory's Beetaloo Basin

About $35m was sourced from Australian investors and over the past 18 months, the company has raised $300m into their Beetaloo asset.

Tamboran chief executive Joel Riddle was buoyed about the day’s events on Monday.

“The thing with this transaction is it comes with a firm gas sale agreement with Origin, the largest gas buyer in Australia, to deliver 100TJs a day for 10 years,” Mr Riddle said.

“That really underpins that initial pilot development and allows us to really get down the learning curve of well costs and deliverability for wells.

“This will facilitate a much bigger development including 1000TJs a day to Middle Arm to tie in with the ambitious plans the Territory government has for Middle Arm including production of ammonia, urea, hydrogen and potentially LNG.”

Mr Riddle predicts the first Tamboran gas from Beetaloo will be production of 100TJs in 2025, scaling up to 1000TJs a day by 2028.

He said negotiations with Origin about a possible purchase began in January following “very public comments” indicating Origin was preparing to roll back their stake in the project.

“The more we discussed working together I think what I found is there is a great appreciation around our capability as a company and focus around shale development,” he said.

“A lot of our board technical team come from the United States and have experience developing shale bases in the US.”

The United States connection had Tamboran link with the nation’s largest rig supplier Helmerich & Payne, which contributed $22m into the capital raising and committed five new-generation rigs which drill 50 per cent faster, further horizontally and allows drilling to be quicker and up to four times more productive.

Mining and Industry Minister Nicole Manison said the government would assess Origin’s sale to Tamboran.

“Monday’s announcement by Origin that it intends to sell its 77.5 per cent interests in three exploration permits within the Beetaloo sub-basin to Tamboran will require approval under s93 of the Petroleum Act,” she said.

“While Tamboran is an existing holder of petroleum exploration permits in the Territory, the proposed transfer will still be assessed against a range of regulatory requirements. All appropriate processes will be followed, and provided Tamboran meet those assessments the Northern Territory government will consent to the transfer.”

Ms Manison said Origin was a valued permit holder in the Beetaloo Sub-basin.

“It has been a key leader with its commitment to exploration and appraisal of the shale gas resource,” she said. “It was the first company to stimulate a horizontal well within the sub-basin and its efforts to work collaboratively with other companies and local businesses is part of the reason there is so much excitement about the development of the Beetaloo.

“Tamboran has long established relationships within the Territory and already owns exploration permits in the Beetaloo sub basin. By taking the opportunity to increase its holding, Tamboran demonstrates the desire to develop the Beetaloo to a commercial gas scenario remains at an highest.”

APPEA chief executive Samantha McCulloch said the Beetaloo Basin represented a huge economic and energy security opportunity for the Northern Territory and Australia.

Samantha McCulloch from APPEA group

“Several APPEA members are active in the region and have invested millions of dollars in exploration and early development – as shown with the announcement of a $60m investment in the Beetaloo and Origin planning to receive future production royalties.

“Research has shown developing the region could create up to 6000 jobs and generate billions of dollars in revenue for governments within the next two decades.”