Sun, which announced the new joint venture in its December quarterly report, said it and VicPet would spend six months evaluating the data for a total cost of US$360,000 (A$479,251).
The companies could then earn a combined 75% working interest in any prospects by free carrying 10% of Wandoo’s working interest in the first well to completion, as well as funding between two US$200,000 (A$266,251) and US$500,000 (A$665,628) of approved land leasehold acquisition costs and seismic reprocessing on prospects within the area of the 3D seismic data set.
Sun Resources said the joint venture would expose the company to a choice of drillable prospects of various risk size potential on a ground floor basis.
“A month of preliminary work has resulted in the recognition of some interesting prospects and leads, particularly for gas in the range of 5 to 100 billion cubic feet in size in prospective stratigraphy/structures at various depths ranging from 1,000 to 4,000 metres in a large 3D data set,” the company said.
“This now high-graded seismic data set will be subjected to some reprocessing and definitive interpretation in the coming months before prospects are ranked for land acquisition by leasing and subsequent drilling in the next 12 months.”
Sun said it was difficult for explorers to work up plays and test new concepts in the US without access to basic data, particularly seismic.
“Generally this means a junior explorer must buy in all seismic data, i.e. carry out his own speculative seismic surveys, usually 2D rather than the more expensive and superior 3D, or buy or licence seismic data from seismic brokers,” Sun said.
“The resulting consequence means exploration is expensive, restrictive and importantly, the opportunity to generate worthwhile prospects and manage risk is extremely limited.”
Wandoo currently has exclusive access to 140 3D seismic data sets covering 16,300 square kilometres, as well as 161,000 line kilometres of 2D seismic.
Under the agreement, Sun can farm-out a portion of its current 37.5% working interest and its further right to additional working interest in any prospects.
The company will also have an option to participate in further joint ventures with Wandoo in the Texas area of mutual interest.
The Wandoo joint venture comprises: Sun Resources (37.5%), Victoria Petroleum (37.5%) and Wandoo Energy (25%).
Meanwhile, Sun said its other Texan project, the Flour Bluff gas development, is producing 6 million cubic feet of gas per day at the end of first year development operations, which is ahead of the independent Ryder Scott development plan schedule for the project.
Phase one development will be completed behind schedule this month with results from EFB E-10 & EFB D-19 D, D-24 and Petty-2 frac stimulation, Sun said.
“This delay is due to stand down of operations due to the abnormally large number of destructive hurricanes on the Gulf Coast in the September quarter and general rig delay problems,” it said.
Last month, Sun acquired an additional 7.5% working interest, with a 76.6666% NRI, in the project for US$3.25 million from Davis Gulf Coast Oil, Inc.
A recent independent reserve update concluded Flour Bluff is a 210 billion cubic feet of gas equivalent project, with 55% of the 97 BCF reserves now in the proved category.
Next month, the joint venture will spud FB-1 - the first well of an 8-9 well program -on the West Flour Bluff Gas Field. This program will target 40.9 BCF of 3P recoverable reserves.
Sun said production could reach 20 million cubic feet of gas per day when the development program concludes.
Australian partners in Flour Bluff are: Sun Resources (20%), Aurora (20%) and Victoria Petroleum (12.5%).
