The farm-in would see Golden State earn an average 65% net revenue interest in acreage currently held by Eclipse Exploration Corporation by repaying sunk costs of $79 per square kilometre up to 90 square kilometres, or $1.77 million, and agreeing to fund the drilling of an exploration well.

The company could elect to drill a second well by repaying additional acreage costs to earn its equity in the prospect.

Two-dimensional seismic data and nearby well data has shown indications of an active petroleum system at Golden Eagle.

If hydrocarbons are found, the prospect could have a 19.5% probability of success with a mid-case (P50) target size of 440 billion cubic feet of gas equivalent and potential for up to 3 trillion cubic feet of recoverable gas equivalent.

Early work by Eclipse has identified a target structure with an aerial extent of up to 20km2 and multiple target horizons between 2600m and 4500m.

The company estimates a mid-case reserve target of 440Bcfe, with upside to 3Tcfe for the maximum 20km2 case.

Targets include multiple sedimentary zones within 1450m of Pennsylvanian (upper carboniferous) section and 240m of deeper Mississippian (lower carboniferous) carbonates.

The Paradox Basin has produced over 600 million barrels oil (or 3.6Tcfe) primarily from Palaeozoic reservoirs since its discovery in 1908.

While the Basin contains several smaller prospects, Golden Eagle is the only known target with similar structural components and size to the giant Lisbon field, 70km to the south, which has produced over 50 million barrels of light oil, 700Bcf of gas and 10 million barrels of condensate from Mississippian reservoirs.

If the farm-in agreement between Eclipse and Golden State Resources is approved, a discovery could be rapidly commercialised and cashflow possible within six months of start-up.