TEE: EP258 Section 31 Deed Executed

Our domestic gas exploration Investment Top End Energy (ASX: TEE) has just released an announcement outlining the successful signing and execution of the Section 31 Deed for its Northern Territory Gas projects.

At present, TEE holds ~58% interest in the exploration permit applications covering ~166,000 km2 in the NT.

The news today clears the path for a formal Ministerial Approval for the permits - which will allow TEE to explore and eventually drill the area for gas.

Once granted, this would mark the first exploration permit (EP) granted in the Northern Territory since 2015.

Last time we wrote about the Northern Territory project, TEE had just been granted native title approval for EP258. Although this was a crucial milestone for the NT permitting process, today’s news is the final and pivotal news that will lead to a formal Ministerial Grant.

Without the Section 31 Deed being executed, a grant for on-ground exploration would not be possible.

The Section 31 Deed is essentially an agreement between TEE, the NT government and the Northern Land Council outlining the ability to explore for resources on the permit area (on-ground).

All this - prior to the final and formal grant of permit by the Ministerial office.

For some context, the EP258 area is a high-priority permit as it sits at the margin-edge of the Beetaloo Basin, which is estimated to be home to enough gas to power Australia for 300 years. The Basin has also drawn in investments from the likes of ~$23Bn Santos and the emerging ~$250M Tamboran Resources.

The exploration strategy at the NT projects that TEE is pursuing is relatively simple.

Once the permit is granted, TEE will look to prove if the reservoir formations currently being explored in the Beetaloo extend underground into sub-basins surrounding it.

The first step after the permit is granted will be to run airborne gravity surveys in the lead up to an on-ground 2D seismic survey.

To date, most of the exploration attention has been focussed on the Beetaloo Basin itself, but TEE is going for ground where most others haven't looked yet — a different higher risk but potentially higher reward exploration strategy if it works.

If TEE’s exploration theory is correct, we think it could change the game in the basin. And being a first mover, this could result in a share price re-rate for TEE.

At this stage, TEE’s theory is largely based on seismic data on ground to its north.

There is no seismic data inside TEE’s ground YET.

Overall TEE’s theory is unproven at this stage - and requires more exploration work to prove.

What’s next for TEE?

Permitting in the NT 🔄

With the native title approval secured and Section 31 Deed signed, we want to see TEE’s high priority EP 258 application granted.

Once granted, this would mark the first exploration permit (EP) granted in the Northern Territory since 2015.

2D Seismic program in Queensland 🔄

Final results from the 2D seismic program are expected toward the end of this quarter.

After that we expect to see TEE firm up where it would want to drill and the timing for any future well.