Sun Resources said it will earn a 7.5% interest in the permit by funding on a promoted basis of 1.5625 for 1 on its earned equity, the dry hole well of either the Kilauea-1 or Hekla-1 wells, which should be drilled late in this first quarter.
Sun said in the case of discovery, it will not be liable to carry a promote on testing if a casing election is made. "All subsequent ongoing expenditures on the permit will be according to the equities in the permit, namely Apache 59.59646%, Wandoo 32.90354% and Sun Resources 7.5%," the company said.
Sun said the well to be drilled in the permit has not been decided however, Kilauea-1 will target potential reserve estimated to range from 400 billion cubic feet of gas recoverable to 905 bcf of gas recoverable.
Meanwhile, Hekla-1 is a test of a structural/subcrop trap at Legendre Formation level with a potential reserve estimate range of 40 million barrels of oil recoverable to 102 million bbls recoverable, the company said.
