In a statement today, the Melbourne-based junior said it would take a 20% working interest in application for drilling reservation 1/06-7 in return for funding 33% of the costs, capped at $2 million, to drill an exploration well on the Selene prospect.

Oil Basins said the permit was in an advanced stage of Native Title discussions with the Kimberley Land Council. Once a number of other regulatory approvals are finalised, the joint venture expects to spud the well during the latter half of this year.

Oil Basins, which listed on the Australian Stock Exchange last August, was restructured and recapitalised from the shell of a former IT outfit called Saxon Investment Group, whose shares on the ASX have been suspended for the past 11 years.

As well as a stake in an offshore Victorian permit, the company holds a 35% stake in Backreef’s Blina Back Reef play, which covers about 374 square kilometres and is in the northeast sector of production licence L6 in permit EP129.