Energy company, AWE (ASX:AWE) has entered into a farmout agreement in a New Zealand exploration permit onshore Taranaki Basin.
The area is located southwest of New Plymouth and is a prolific gas producing region which contains a number of substantial prospects.
The current joint venture partners in the permit are AWE and Mitsui with 51 and 49 per cent interests respectively.
The deal will see the joint venture farm down a combined 50 per cent working interest to New Zealand Oil & Gas and its majority shareholder O.G Oil & Gas.
Each incoming company will acquire a 25 per cent working interest in the permit, while AWE will remain as operator with 12.5 per cent interest and Mitsui will retain a 37.5 per cent interest.
The joint venture agreement is expected to be completed by the end of May 2018.
Shares in AWE (ASX:AWE) are trading 0.26 per cent lower to 95 cents.