Speke South was chosen over the SE Tarra prospect as the company considered it to be of more favourable size and economics, though partner Bass Strait Oil Company said SE Tarra remained a viable exploration target and may be drilled in the future.
Apache is still carrying out detailed mapping and interpretation of the two prospects due to late arrival of final 3D data processing.
The company is acquiring a 60% stake in VIC/P42 from Bass Strait Oil Company, which will be free-carried through the drilling of the well and retain a 20% stake in the permit. The remaining 20% is owned by Japan's Inpex.
Speke South-1 will be third well drilled by the West Triton jack-up drilling rig for Apache Energy.
Vic/P42 is adjacent to Australia's largest oil field, Kingfish, and is close to several other Esso-BHP producing oil and gas fields.
The permit already holds the Zane Grey and Omeo gas and condensate discoveries, which are not commercial but could be developed if other finds are made in the area.
Bass Strait Oil said success in Apache's drilling program in the southern Gippsland Basin had the potential to underpin new infrastructure projects in the area and benefit all participants.
