The project involves connecting up to two horizontal wells – Woollybutt-4 and Woollybutt-6 – to the existing leased floating production, storage and offtake Four Vangard vessel via subsea pipeline.

In a statement released on Friday, partner Tap Oil said the JV, which also comprises operator Eni and Mobil, has authorised all required expenditures and has secured contracts for most of the project.

This includes drilling and completing the two wells; FPSO modifications; subsea Christmas trees, flowlines, manifolds and control systems; and installing and transporting necessary equipment.

Drilling is expected to start in the middle of this year, with first Woollybutt South Lobe production expected in early 2008.

The Woollybutt-4 development well is expected to boost oil production at the field by about 10,000 barrels per day and also “substantially increase” field life, according to Tap. The FPSO contract runs until 2009 with optional extensions until 2013.

To date, the field has produced around 26.5 million barrels of oil and is currently producing 11,000bopd.

Interests in WA-25-L are Eni Australia (operator – 65%), Mobil Australia Resources (20%) and Tap Oil (15%).