The Victorian-based company yesterday said drilling at its 100%-owned PEP 162 and EL 4537 exploration licences would begin in the middle of this month.

Karoon said rig mobilisation and site preparation has already begun for the first of three wells, with government approvals progressing to plan.

“Interpretation of the recent 250km 2D seismic survey data has shown positive results with three prospects now worked up for drilling,” the company said.

“Each prospect has a potential reserves capacity of about 3 million barrels of oil.”

The company also said initial economic screening has indicated that due to the close proximity of infrastructure, there is a minimum economic reserves threshold of 500,000bbl.

Karoon yesterday announced it is planning to raise almost $22 million via a share placement to fund drilling work in the Browse and Gippsland Basins.

The explorer said it had agreed to place 12.186 million fully paid shares at $1.80 each to sophisticated and institutional investors in Australia and the United Kingdom.

It plans to use the funds to cover its share of a two-well program in the Browse Basin, extended drilling in the Gippsland Basin and for general working capital.