Cook, who has significant skin in the game himself as a shareholder, says that the new Carnarvon sees itself "very much" in the mode of a technically-focused North West Shelf specialist explorer, one that is prepared to do a lot of the geological and geophysical legwork over parts of the basin that may have fallen from favour or been overlooked.

It will then seek funding for drilling by farming out, but while that is Carnarvon's bread and butter, the junior also knows it needs some near-term production spice, which is what the recent Quadrant farm-in offers.

Third Wave

Cook says that the company believes that Australia's most prolific producer, the Carnarvon Basin, is roughly where the North Sea was 20 years ago, and is just at the cusp of a third wave of exploration.

The first wave focused on the original near-shore discoveries through-out the 1970s and early 1990s, while the second wave pushed into deeper and deeper waters.

Now, he says, the time is right to look at the deeper stratigraphy in shallower waters, and at overlooked areas such as the Bedout Sub-basin.

If Cook and his team are right there's a lot left behind to explore in the shallow areas - big undrilled deeper structures and smaller oil pools rife for hub style developments.

"I guess what we are trying to do, as North West Shelf specialist explorers, is know we can't go to bat with a Woodside Petroleum or Quadrant Energy," he said.

"We need to find the play types that haven't yet been tested because they are at the next level of risk - the sort of things that the North Sea did 20 years ago - and that brings risk because they are deeper and you don't have the well control to help draw out the stratigraphic plays which are inherently riskier than conventional four-way traps, but that is where the North West Shelf will go in time.

"We think now we can offer the Santos and Quadrants of the world some service by doing some of that sort of work that they are constrained from doing at the moment, because we are not producing barrels and we are not worried about where oil prices are today, we are thinking about tomorrow."

There hasn't been much jack-up activity in the basin over the last decade, but Cook hopes that the sort of success Carnarvon has had with Phoenix South-1 and Roc-1 will lead to more wells, and more success, and he says now is the ideal time to take advantage of lower rig costs.

"There is an important window here with Quadrant having the jack-up [Noble Tom Prosser] under contract for 18 months," he said.

"Support costs around it are decreasing, so you have a rig available with falling service costs and a belief in our company that oil prices will eventually rise."

Cook says oil prices turn on the marginal cost to produce a barrel, and the longer the oil price stays depressed the more current production risks being rendered uneconomic.

He can't say when the change will come, but when the oil price does start its recovery he wants Carnarvon to have a few development options to take advantage of the change of circumstances.

Cook says there is no argument that the Carnarvon Basin is a strong hydrocarbon province with developments such as Macedon, Pyrenees and "FPSO alley", and while the company has carved itself a niche in the emerging Bedout Sub-basin, it is also trying to spread itself around in terms of both risk and time scale.

Outtrim East

That's why earlier this month it entered a project with Quadrant to drill the Outtrim East-1 well, an exploration well testing a potential expansion of a small 1980s era Barrow Sub-basin discovery.

By securing 35% of TR/3, WA-155-P(1) and WA-486-P Cook says Carnarvon is setting up for a number of near-term development options.

"Our plan is to test Outtrim East-1, and there are a number of prospects and leads nearby and out to the east, plus outside our holdings is Corowa which is owned by Hydra Energy, who we are good friends with," he explained.

"The ideal outcome would be that Outtrim East-1 would come in at the P10 level and it would be a strong commercial standalone development, and from there you could tie-back [the nearby] Blencathra and any of these leads, and potentially Corowa as well."

While Carnarvon hasn't put any numbers around the potential of the follow-up well to 1984's Outtrim-1 discovery, which was then considered too small for development, Cook said around 20 million barrels at $A70/bbl would stand a good chance of being developed.

The more oil than can be tied back, the more robust the project look.

The junior, which is paying 35% of the well costs to earn 35% in the three licences, is banking on the Quadrant team's skills in finding out and its ability to make a hub development work.

"If anyone can aggregate small pools in a string of pearls style development it is Quadrant, which has done well in the past at Harriet in the old Apache Energy area," he said.

Cook told Energy News that the Outtrim East deal had been in the background for some time, but that it was only with the success of the Roc-1 well that Carnarvon pressed the button, because it knew it had the balance sheet capability to fund a share of the well.

The company has around a $6-7 million share in the carry left over from Roc-1 which will basically offset the costs of Outtrim East-1, and help preserve the $100 million the junior in the bank, leaving Carnarvon capable of participating in smaller opportunities such as Roc-2 and Cerberus.

Cook says Carnarvon is also talking to other operators in the basin, but it is trying to find a balance between good projects, development commitments and timing, so it can "lean into" the oil price recovery.

"Those are the commercial conversations, but we are also regionally mapping all of the subsurface features in this basin, and if we see something we like we ask if it's open, if it will be up for government bid or who has it, and if so what the commercial terms might be and if it matches our view on timing," he said.

He hinted that Outtrim East may not be the only deal Carnarvon does this year.

Cerberus

It was the company's decision to review all of the Carnarvon Basin that led to its decision to bid for the Cerberus blocks - a decision that appears to have been vindicated by the 2014 Phoenix South-1 oil discovery, which has helped de-risk the previously overlooked Triassic plays.

As luck would have it, those same plays exist in Cerberus, and they have been further bolstered by the presence of oil in the base of the follow-up well at Roc-1.

Cerberus blocks contain many of the same Triassic plays.

Cerberus' plays have actually been boosted by the oil shows deep in Roc-1, as they are the same deep targets Carnarvon aims to drill.

Work to date has defined the Belfon Upper Permian and Honeybadger Early Triassic prospects, which could contain "significant" volumes of recoverable oil, and all sitting in shallow waters with targets at most 3000m below the mudline.

Five Jurassic prospects also exist at reservoir depths between 1000-1500m and there are a further set of Cretaceous shallow oil prospects at just 500m depth that could be large in the context of North West Shelf oil prospects

If a jack-up can be secured Cook says the wells can be drilled for comparatively little money, on par with some of the more expensive Canning Basin onshore wells, which Carnarvon is pondering if it really needs a partner after all.

Cook said there have been a number of internal discussions on that front. While the company has the cash to capture all the upside, the plays have never been tested.

"We have an interesting conundrum on Cerberus. If a year ago it was a $15 million well and we looked to farm out half, and now the well is half that we need to think about whether we want to drill a $7.5 million well in what is very high risk but potentially very large oil play," he said.

"If we decided to do that we have the balance sheet to carry that."

One-hundred percent of a 100-200MMbbl discovery would be a company-maker for Carnarvon.

The drilling commitment year starts in July 2017, and the company wants to be ready to start that work, so it has already started the permitting process for as many as four wells.

Bedout Sub-basin

The company is now batting two for two in terms of wildcat exploration in the overlooked Bedout Sub-basin, although as with any frontier exploration each discovery raises questions.

Roc-1 tested an anticlinal target which was considered to be the best of the oil prospects in the Phoenix area, just 5% of the Bedout Sub-basin blocks, but it was not to be.

The structure was drilled on target updip of Phoenix South-1, but while the sands were good it appears were was no seal at the same level, but a decision to deepen the well into a different structure appears to have clipped the edge of a separate prospect, which resulted in a gas-condensate discovery.

It is now a case that work needs to be done to consider if the crest of that structure should be the next well drilled with Roc-2.

Carnarvon's shares took a bit of a hit with the result, but Cook says the company and its partners are still putting together the data.

"The thing people need to remember is that there are 16 wells in 22,000sq.km, and we have drilled two of them, with hydrocarbons in both," he said.

"That is a good start, and even if it wasn't filled to spill, setting up the next structure that's just exploration.

"We also have hydrocarbons at Roc and Phoenix South that are also not incompatible."

That leaves open the idea of a hub development, something that could be supported by an independent resource report, although Cook said Roc-2 would likely be needed to reduce uncertainty for any future development.

It could involve liquids stripping and pipeline the gas onshore to either a standalone plant or into Quadrant's Devil Creek plant some 300km.

Cook understands the rig may be available to drill Roc-2 within 12 months, but there is a lot of work and approvals to complete before then.

Cook says the company is looking for other projects on the North West Shelf, and may bid in the next Commonwealth acreage round.