Junior explorer 3D Energi (ASX:TDO) has suspended trading in its shares after being unable to meet a cash call linked to ConocoPhillips' $100 million-plus offshore gas exploration campaign in Victoria, with drilling costs significantly exceeding estimates.
The company said it had received a default notice from ConocoPhillips requiring payment of about US$2.5 million by Feb. 6, with a further US$5.3 million also expected to fall due, potentially triggering another default.
Despite a gas discovery at the Essington-1 well in November, 3D said extensive post-discovery testing, along with weather delays and technical issues at the Charlemont-1 well, drove costs higher.
The company, which holds a 20% stake in the venture alongside Korea National Oil Corporation, said the trading suspension would remain in place while it addressed its funding position and assessed the impact of the payment default on its permit interest.