Australian oil and gas exploration company Big Star Energy has leased a further 59,510 gross (14,877 net) acres across its prospect and lead portfolio in Colorado, US.
The news comes just two days after the company said it had acquired 63 new leases in Colorado at the State Land auction, which brought its gross to 27,104.
“Big Star now has 86,614 gross acres in total, giving us an industry-significant lease position in this highly prospective helium area,” Joanne Kendrick, Big Star Managing Director, said.
“Importantly this new lease also covers two additional helium anomalies from our regional soil gas survey acquired earlier this year.”
“We will continue to be guided by our regional soil gas survey and internal geologic model in consolidating our leasing position as we prepare to permit our five-well drilling program early next year.”
The new lease is for an initial term of five years with an option to renew for a further five years.
If the company successfully produces helium or other products from the lease area, a 12.5% royalty will be payable to the lessor and the lease term will be extended indefinitely until production ceases.
The lease does not include any minimum work commitments, Big Star said.
The company has agreed to pay a consideration of $75,000 to the lessor on completion of the acquisition of the lease, which is due on or before 1st April 2020, subject to customary due diligence.