Exploration Risks Loom as Central Petroleum Reactivates Dormant Cooper Basin Permits
Central Petroleum has completed its acquisition of strategic interests in the Otway and Cooper Basins, setting the stage for a multi-well exploration campaign starting in the second half of 2026.
- Acquisition of 20% interest in PEP 169 (Otway Basin) and 49% in Cooper Basin permits
- Multi-well drilling program planned over next 18 months, beginning with Enterprise North well
- Enterprise North prospect holds estimated 79 Bcf gas in place with potential for near-term production
- Cooper Basin permits reactivated after nine years, with drilling expected in first half of 2027
- Proximity to existing infrastructure and strong Victorian gas market supports value accretion
Strategic Acquisition Completed
Central Petroleum Limited (ASX – CTP) has officially completed the acquisition of interests from ADZ Energy in key conventional exploration permits located in the onshore Otway and Cooper Basins. This transaction marks a significant expansion of Central’s footprint in two of Australia’s premier hydrocarbon provinces, with Central now holding a 20% stake in Petroleum Exploration Permit 169 (PEP 169) in Victoria’s Otway Basin and a 49% interest in multiple Petroleum Retention Licences (PRLs) and Petroleum Exploration Licence 677 in South Australia’s Cooper Basin.
Enterprise North – A High-Quality Gas Target
The centerpiece of Central’s near-term exploration plans is the Enterprise North prospect within PEP 169. Scheduled for drilling in the second half of 2026, this well targets natural gas in the Waarre Formation, a world-class conventional reservoir known for its exceptional permeability. Central estimates up to 79 billion cubic feet (Bcf) of gas in place at Enterprise North, with its 20% share approximating 16 Bcf. The prospect benefits from seismic amplitude anomalies and is strategically positioned near existing gas infrastructure, including the Iona, Otway, and Athena gas processing plants, facilitating potential rapid commercialisation.
Designed as a production well in the event of success, Enterprise North could significantly boost Central’s gas output, potentially doubling current production rates. The high permeability of the reservoir suggests rapid gas flow, with expectations to produce over half the gas within a three-year timeframe. Moreover, the proximity to the Victorian gas market, which commands strong pricing, enhances the project’s economic attractiveness.
Revitalising the Cooper Basin Assets
Alongside the Otway Basin interests, Central’s acquisition includes a near 50% stake in several Cooper Basin permits that have been dormant since 2016. Following a comprehensive review and seismic reprocessing completed in 2024, Central and its partners have identified multiple promising oil and gas targets. Exploration drilling is anticipated to commence in the first half of 2027, with plans to test two to three prospects. The Cooper Basin’s mature infrastructure network offers a swift pathway to market for any discoveries, leveraging existing pipelines and refineries.
Outlook and Market Implications
Central Petroleum’s strategic acquisitions and planned exploration activities position the company for meaningful growth in production and reserves. The combination of high-quality conventional reservoirs, proximity to established infrastructure, and access to high-value gas markets underpins the potential for strong financial returns. While resource estimates remain prospective and contingent on exploration success, the company’s approach reflects a calculated balance of risk and opportunity.
Investors will be watching closely as drilling progresses, particularly at Enterprise North, to gauge the viability of these assets and their contribution to Central’s portfolio. The company’s ability to convert prospective resources into producing assets will be critical in shaping its future trajectory in Australia’s competitive energy sector.
Bottom Line?
Central Petroleum’s next 18 months will be pivotal as exploration results could redefine its production profile and market standing.
Questions in the middle?
- What will the initial flow rates and reservoir characteristics be from the Enterprise North well?
- How will Central manage capital expenditure to balance exploration risks with near-term production goals?
- What impact will successful discoveries have on Central’s valuation and strategic partnerships?
