The permit equity interests will be: Nexus Energy 50%, Voyager Energy Ltd 30% and

Wandoo Petroleum Pty Ltd 20%. Wandoo is an affiliate of major Japanese company Mitsui.

“W04-17 is a large permit with an existing non-commercial oil discovery at Gage Roads,” Nexus said.

“The presence of an oil accumulation in the permit confirms the presence of an active oil generating petroleum system in the area, and Nexus and its Joint Venture partners have been attracted to the permit through the identification of a large untested structure close to the Gage Roads oil discovery.

"This structure has been mapped at the base of the South Perth Shale and has the

potential to contain in excess of 200 million barrels of oil.”

Voyager managing director John Begg said his company was pleased to pick up the permit.

“We have had our eye on this block for some time,” Begg said.

“There is a proven petroleum system in the area and we are attracted to a large structure of a type that hosts significant reserves on the northwest shelf but is yet to be the subject of a valid test along this part of the Western Australian coast."

The structure lies in an area where seismic data quality is affected by the shallow geology and it is only recently that improvements in seismic processing have overcome these difficulties and made a more confident interpretation of the structure possible, according to Nexus.

The joint venture has committed to acquiring a 300 square kilometre 3D seismic survey in the first year of the permit term. This will ensure the structure is thoroughly delineated before an exploration well is drilled in the third year.

“The award of the permit is consistent with Nexus’ ongoing strategy of ground-floor acquisition of high quality exploration opportunities in Australia at significant equity levels,” managing director Ian Tchacos said.

“The high equity level which Nexus holds in the permit provides the flexibility for the company to either reduce exposure to the cost of drilling the exploration well by attracting joint venture partners through a promoted farmin or remaining at the current equity level and fund its share of the well cost.”