Sunshine, which will remain as operator, was awarded the 1480 square kilometre permit in western Queensland at the beginning of March this year.

The company said it believes ATP 789P, which is adjacent to the Kenmore and Bodalla South oil fields to the west and the Bargie oil discovery to the east, has potential to contain both Jurassic oil and Permian gas.

Managing director Tony Gilby said the Sunshine board welcomed Avery’s decision to farm-in to ATP 789P, and looked forward to a successful exploration program.

“We are currently in the planning phase for the new 2D seismic acquisition and the farm-in interest shown by Avery is clear testimony to the ATP’s prospectivity,” Gilby said.

“We note that since establishing a presence in Australia, Avery has been particularly active in seeking prospective acreage to farm into, and demonstrated a pro-active approach to exploration.”

Sunshine plans to start seismic acquisition later this year with a view to drilling identified oil exploration targets in early 2007.

Avery is an international oil and gas exploration company based in Calgary, Canada, trading on the Toronto Stock Exchange.

The company’s primary interest is in Australia, where it has onshore Cooper Basin projects in four areas in South Australia, and with the new Sunshine Gas area, now has interests in four areas in Queensland.

The company also has an interest in the Katandra-1 offshore oil discovery in the Timor Sea.