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Image courtesy of Apache.

Houston-based Apache passed on an option to farm in to the AC/P50 and AC/P51 exploration permits in the Vulcan Sub-Basin offshore northern Australia Tuesday.

Apache signed an option agreement in June with Australia-based MEO Australia to potentially acquire a 70 percent interest in the permits at their renewal in 2015.

If Apache had exercised its farm-in option it would have carried MEO’s share of all costs up to and including the first well to be drilled in each of the permits.

MEO holds 100 percent stakes in both permits.

MEO estimates that permit AC/P51 has recoverable reserves of up to 150 million barrels of oil equivalent.

“While seeing this option lapse is clearly disappointing, we will continue to remain receptive to potential 3rd party farmin offers in the period leading up to permit renewal in April 2015,” MEO’s CEO and MD Jurgen Hendrich said.