UPDATE 1.15pm: Woodside Petroleum has struck an agreement with Daewoo International Corporation for a production sharing contract in Burma.
It is the first time the oil and gas producer will operate in deep water off Burma.
The deal means Woodside will take a 40 per cent participating interest in the production sharing contract subject to due diligence and approvals.
"The transaction also provides the option to drill an exploration well in a subsequent exploration period." Woodside said in a statement.
Woodside said the production area was for Block AD-7 in the Rakhine Basin, located in the western offshore area of Burma.
Woodside and Daewoo will be able to undertake a 3D seismic acquisition program between 2013 and 2014.
Woodside's activities are primarily located offshore in north western Australia, with the international focus on the Gulf of Mexico, Peru, Brazil and the Republic of Korea.
Woodside CEO Peter Coleman said the Daewoo offer demonstrated the company's commitment to secure international growth opportunities in frontier and emerging basins.
"The Rakhine deep water basin is an exciting frontier exploration area and Block AD-7 is adjacent to the Daewoo-operated Shwe field development," Mr Coleman said.
Woodside shares closed up 78 cents, or 2.22 per cent, at $35.98, extending yesterday's strong gain.