The VIC/L24 production licence has been awarded by Victoria's Department of Primary Industries and during the first quarter of this year the project has advanced rapidly to be 36% complete as at the end of March, Santos said.
The joint venture has begun drilling a pilot hole for the directional shore-crossing and completed the onshore pipeline installation.
"Preparations have also started for development drilling operations with the Casino 4 and Casino 5 wells currently scheduled to start drilling at the end of April," Santos said.
All reserves from the offshore Otway Basin gas field have been sold under contract to TXU.
The gas will be processed at TXU's Iona processing plant. All remaining conditions precedent for the gas sales agreement with TXU have been satisfied or waived.
"The finalisation of this innovative gas sales contract has enabled accelerated exploration drilling activity with an option being exercised for the drilling of the Henry-1 well, immediately north-west of the Casino gas field," Santos said.
"The Casino joint venture is also exploring options to drill the adjacent prospects immediately after the Henry 1 well."
Participants in VIC P/44 and VIC/L24 are Santos Limited (operator) 50%, Peedamullah Petroleum Pty Ltd (wholly-owned subsidiary of AWE) 25% and Mittwell Energy Resources Pty Ltd (wholly-owned subsidiary of Mitsui) 25%.
