Central Petroleum has announced a multistage farm-out agreement with French energy giant Total for the exploration of about 2.4 million hectares in central Australia.
Central said the agreement covered four "highly prospective" areas in the vicinity of recent discoveries in the Southern Georgina Basin in west Queensland.
The joint venture will invest $US60 million in stage one with options for a further $US130 million to be invested for stages two and three.
If Total fulfils its funding obligations for stages 2 and 3, it will earn up to a 68 per cent holding in the permits.
Under the terms of the deal, Total will initially spend $US48 million in stage one with Central funding the next $US12 million.
Central chairman Dr Henry Askin said the agreement provided substantial funding for a full exploration program while retaining for Central the opportunity to develop its capacity as an independent operator.
"This agreement pursues a course that gives priority to the exploration of our extensive acreage by providing for an accelerated exploration program which would not have been otherwise possible," he said.
Chief executive Richard Cottee said the agreement provided capital for a fully funded exploration program while also retaining significant interest in the nearly 6 million acres the company holds in the Southern Georgina Basin.
"This, and the agreement announced last month with Santos, together covers only half of our current exploration territory," he said.
"If successful, the expertise and funds generated under these agreements will enable Central to become an independent self-funding operator of any future discoveries."
Central shares were off half a cent to 18 cents at 8.10am.