IPB Petroleum to drill offshore oil discoveries


Transcription of Finance News Network Interview with IPB Petroleum Limited (ASX:IPB) Managing Director, Brendan Brown

Lelde Smits: Hello I’m Lelde Smits for the Finance News Network and joining me from exploration company IPB Petroleum Limited (ASX:IPB) is its Managing Director, Brendan Brown. Brendan welcome to RIU’s Good Oil Conference here in Perth.

Brendan Brown: Thank you very much, thanks Lelde.

Lelde Smits: IPB Petroleum has interests in petroleum exploration permits in the Browse Basin, offshore northwest Australia. When did you acquire them and how much exploration has occurred since?

Brendan Brown: We started to acquire the permits in late 2010. And since then, we’ve acquired a 3D seismic survey and we’ve completed a farm-out in the first of our permits for the drilling of a well, later this year.

Lelde Smits: What is the size of the resources currently attributable to the Company and your potential to expand them?

Brendan Brown: We’ve had independently certified mean prospective oil resources of 672 million barrels. And with our upcoming exploration well, we’d expect to de-risk some of those barrels and it may in the event of success, cause an increase to those resources in time.

Lelde Smits: Now when we last spoke in August you mentioned a number of priorities including the drilling and appraisal of the Pryderi discovery. How are these plans progressing?

Brendan Brown: They are progressing well. We plan to lodge our environmental plan i.e. the operator of the permit, expects to lodge it within the next week to two weeks. And we’re targeting to be drill ready towards – for the last quarter of this year.

Lelde Smits: Beyond appraisal, have you put a timeline on predevelopment studies with the view to developing the Pryderi discovery?

Brendan Brown: We have an indicative timeline, which will be to drill an exploration well in the last quarter of this year. Hopefully our notional appraisal well, in the event of success around mid-next year and then you’d expect another six months of studies before you, or maybe even 12 months of studies, before you move to an FID on a project.

Lelde Smits: IPB’s latest and third exploration permit is the WA-485-P. How does it compliment your portfolio and what is your exploration strategy for it?

Brendan Brown: It compliments our existing portfolio because we can see an extension of the main, what we call the M.australis play, which we intend to test with the Pryderi exploration well. It adds to the resources. So in the event of success at Pryderi, we will have captured through acquiring this new permit, a continuation of that prospectivity and hopefully additional resources.

Lelde Smits: Turning to your financials, what cost estimates have you put on your drilling campaign and could you talk us through your funding model as we progress to 2014?

Brendan Brown: The funding model is relatively simple. The well Pryderi is fully covered through the farm-in to CalEnergy. So in fact, no dollars will need to be spent by IPB on the drilling of that well. In the event of success, CalEnergy have an option to increase their interest in the permit by spending additional funds. And notionally, that will cover additional exploration activities which could mean an appraisal well.

Lelde Smits: OK Brendan, let’s look at some milestones now. The Company has only been trading on the Australian Securities Exchange for about four months. What do you believe have been your biggest milestones since listing?

Brendan Brown: I think the biggest milestone since listing is acquiring the additional 485-P permit. That was something we were hoping to achieve.  And of course, we were fortunate in being granted that permit and adding substantially to our existing resource base. And then I guess we’re looking forward to the drilling of the well, so we’re waiting for the big second milestone which is the drilling of our exploration well.

Lelde Smits: Finally Brendan, what would you like to see IPB Petroleum achieve as you celebrate your anniversary of listing next year?

Brendan Brown: Well hopefully on the anniversary of listing, we will have had a successful well which we won’t know until we actually drill it. But we’re looking forward to that and that would be, you know a wonderful outcome for the shareholders over the first 12 months of listing.

Lelde Smits: Brendan Brown, thank you for the update to IPB Petroleum.

Brendan Brown: Thank you very much, thanks Lelde.