Liberty News. For 21 Sept 2012




Karoon executes an agreement to farm-in into North Carnarvon Basin Permit WA-482-P


21 September 2012 - Karoon Gas Australia Ltd. (ASx: KAR) through its subsidiary Karoon Gas (FPSO) Pty Ltd, executed final agreements for Karoon to acquire a 100% interest in WA-482-P in the North Carnarvon Basin, Australia (“Permit”), from USA Independent Liberty petroleum Corporation (“Liberty”).  In consideration for the equity in the Permit, during the first two work permit years, Karoon will manage the permits and be solely responsible for the programs, budgets and expenditure on the Permits.


Karoon has conducted a significant amount of due diligence over the acreage before its recent award to Liberty, and is pleased that it has the opportunity to add prospective acreage before its recent award to Liberty, and is pleased that it has the opportunity to add prospective acreage at the beginning of the exploration lifecycle to complement its more mature exploration acreage which has reached the drilling phase.  Karoon believes that the transaction was executed on favorable terms allowing Karoon freedom to explore the block in the early stages but avoid a large capital commitment if it chooses to exit before Year 3.


Key Terms


·     Karoon is required to meet the year 1 and 2 work program commitments, as outlined below:

o   Year 1: License 3,800 km2 of reprocessed 3D seismic data and approximately 5,000 line km of reprocessed 2D seismic data; and

o   Year 2: Acquire and process 2,010 km2 of 3D seismic data.

·     Following completion of the second year of the Permit term, Karoon has withdrawal rights under the farm-in agreement and would be removed from title after ear 2 and, importantly, before Year 3 well commitment in is due.  If Karoon elects to acquire the Permit, such assignment will be conditional on regulatory approval.

·     Liberty is entitled to certain milestone cash bonuses and a royalty in the event of production.

·     Karoon is responsible for conducting all operations on the Permit during the farm-in period.

              WA 482 – Granted to Liberty September 2012

         WA-482-P Block Status

•  3MM+ Acres


• North Carnarvon Basin, Australia.  400-2000m water depth.  On trend with North        Carnarvon Basin Mungaroo plays and Phoenix gas discovery.

Prospective resource:

• 6 prospects with Prospective Resource total of approximately 2.8 billion barrel of oil.


• Farm out to Karoon   September 21, 2011

• They earn 100% by completing years 1 and 2 work program of geological and geophysical studies and acquisition of 2010 sq km 3D seismic.

Karoon Forward plan:

• Acquire seismic (in progress now)

• Farm-out


• Karoon has received several queries to farm in to WA-482-P.  Karoon is currently considering its options.

Operational Highlights:

• Currently acquiring 2300 sq Km 3D seismic over the eastern area of the permit.

• Reprocessed existing 3D seismic data received and is currently being interpreted.

Future exploration plans:

• Complete 3D seismic acquisition 3rd quarter and process to PSDM ahead of integrated seismic QI and geological studies.  Drilling planned for early 2015.

Development Options: likely to be standalone FPSO.  Economic screening studies initiated.