In a statement yesterday, junior partner Australian Oil Company announced it was farming-out 7.5% of its interest in the Eagle Bay Resources-operated permit to UK-based Dome Petroleum Resources.

Last October, Dome and France’s Kappa Oil Services agreed to buy about 70% of shares in White Sands, which was forced into administration after its automated WSP Rig-1 failed to live up to expectations.

The rig had been contracted to undertake drilling in the PEL 182 permit, in a deal that saw White Sands earn a farm-in stake and a $1 million cash advance.

But the farm-in contract was terminated and the money recouped when the unit encountered major problems at its flagship well, Primero-1, in PL 231.

Under the new farm-in deal, Dome has agreed to pay $1.4 million towards drilling the next four wells and 15% of completion costs in return for a 7.5% interest in PEL 182, excluding last year’s Emily-1 discovery well. The company has an option to acquire a 7.5% interest in Emily-1 if it returns 15% of the drilling costs to AOC.

AOC will keep a 5% working interest in PEL 182, while the other partners are AuDAX Resources (39.9%) and Eagle Bay Resources (operator – 36.7%).