London-listed Northern Petroleum has been awarded a 5800-square kilometre shale oil licence onshore South Australia’s Otway basin.

The explorer said that it had gained a 100% stake in Petroleum Exploration Licence (PEL) 629 for an initial five-year term.

Northern Petroleum managing director Derek Musgrove said that the new block fitted the explorer’s unconventional strategy of targeting low-entry cost blocks for future farm-out potential.

The company saw the Otway basin as particularly attractive because its existing infrastructure would allow for fast development of any discovery, he added.

The area is home to five gas fields with significant amounts of condensate, but is otherwise little explored, according to Northern Petroleum.

Only five stratigraphically deep exploration wells have been drilled within the licence and 4468 line kilometres of 2D seismic data recorded, the explorer said.

Twenty-two wells have been drilled altogether on the new licence, which comprises partial relinquishments from PELs 82, 154, 155, 186 and full relinquishment of PEL 187.

The PEL 629 licence also holds conventional prospectivity but Northern Petroleum plans to focus on the unconventional potential of the Late Jurassic to Early Cretaceous Casterton and Sawpit formations.

Its first activities on the licence will see geochemical analysis, seismic reprocessing and log processing to help evaluate potential unconventional shale sequences for light oil, condensate and gas potential.