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Image courtesy of ConocoPhillips.

Origin Energy acquired a 40 percent stake in two Australian offshore exploration permits held by Karoon Gas for US$600 million in cash Tuesday.

An additional US$75 million will be paid once a final investment decision is made.

Origin will also pay US$75 million when the permits start production.

An extra US$50 million will be payable on first production if proven and probable reserves hit certain thresholds.

The deal could be worth up to US$800 million.

Australia-based Origin Energy is an integrated energy company with assets in electricity, natural gas and liquefied petroleum gas.

Karoon is an Australia-based exploration and production company.

The permits, WA- 315-P and WA-398-P, are located in Western Australia’s Browse Basin.

The two permits make up two thirds of the Poseidon Gas Field.

ConocoPhillips operates and owns a 60 percent stake in the WA- 315-P and WA-398-P permits.

Conoco estimated Poseidon’s reserves at 7.6 trillion cubic feet of gas and liquids.