The program will consist of an initial vertical well to test the deeper section, and then a subsequent sidetrack well, from the same surface location, to test the Dongara/Wagina section of the structure.

Arc said the Hovea-2 vertical exploration well will be drilled in a position where it thinks it may not intersect the Dongara/Wagina section and if this section is not encountered, the company said that the well will be plugged back and sidetracked after the vertical well has been logged and evaluated.

The sidetrack will be aimed to intersect the Dongara/Wagina oil pool in a crestal location in the structure.

Drilling of the Hovea-2 well and any sidetrack will be operated by Origin as part of the L1/L2 farmin agreement. Arc will be carried for the first $1.5 million of expenditure in the program.