In February 2000, the Victorian Government offered Essential the permit on the condition that any oil and gas activity would take place only with the approval of the Gunditjmara People.

Essential has now informed the stock exchange that the in-principle agreement reached in May 2001 has now been formalised with the signing of the exploration consent deed.

The permit, which is located in the south western corner of Victoria, covers an area of 1,692 sq.km and according to Essential has a number of oil prospects including the Cobboboonee target with an estimated recoverable 40 million barrels of oil (mmbbls) and the Glenaulin target with an estimated recoverable 21 mmbbls.

Essential said a seismic exploration survey over these targets is planned for later in 2002.