AGL Energy Limited (AGL) has executed an Agreement to sell AGL's 50% interest in PEP51151 (Alton) to New Zealand Energy Corp. The Agreement is subject to obtaining New Zealand ministerial consent.

As previously announced NZEC have agreed to fund 100% of LME's share of expenses in the currently drilling Talon-1 exploration well - approximately NZ$1.75 million (including $250,000 of completion costs, in the event of a discovery), with LME retaining its existing 50% interest in PEP 51151.

Talon-1 is the first well to be drilled on the 482.4km2 permit, which also contains multiple further targets. The well is targeting mean reserves of 2mmbbl oil (recoverable) in shallow Manutahi sands in a structure geologically identical to the adjacent Manutahi Oil field operated by Origin Energy (estimated recoverable reserves of 4mmbbl).

Talon-1 drilling operations are currently underway: surface casing has been set to 507m and the drilling rig is currently being set up for drilling the second, deviated phase of the well to the target depth of 1455m.

Tags: AGL Energy Limited