Herbert Smith Freehills has advised ASX-listed Origin Energy Limited on its acquisition of exploration interests in two unconventional gas blocks in the Cooper-Eromanga Basin, South Australia through farm-in agreements with Senex Energy Limited.

The two blocks comprise parts of existing titles PEL 115 and 516 (Area A) and the permian section and all underlying strata of part of PEL 514 (Area B) which together cover over 1,900 km2 . The blocks provide exposure to multiple unconventional play types including tight sands, shale and deep coal seams.

Following completion of the farm-in agreements, which is expected by around 30 June 2014, Origin will contribute A$97 million towards an exploration program on each block (Stage 1) to earn a 40% participating interest in Area A and a 30% participating interest in Area B.

Origin will then have the option to earn an additional 10% participating interest in each Area by contributing A$72 million towards a pilot appraisal program in each Area (Stage 2).

Origin also has the right to assume operatorship in each Area after completion of the pilot appraisal programs.

The Herbert Smith Freehills team was led by Rob Merrick (partner) and Michael Basanovic (senior associate) who were assisted by Sharon Wilson (partner), Jane Ballard (solicitor), Simon Yamchikov (solicitor), Grace Caterina (solicitor)  and Katherine Perincek (solicitor).  Neil Tracey, Senior Corporate Lawyer – Upstream and Exploration, led the Origin in-house legal team.

Rob commented: “We are delighted to have assisted Origin with this transaction, and that our leading oil & gas team remains at the forefront of unconventional gas activity that is reinvigorating the Cooper and other onshore Australian basins.”