In October 2010 Somerton and Beach Energy Limited submitted a joint work program bid for gazettal block VIC/O-10(1) in the Otway Basin of western Victoria.  In July 2011 Somerton and Beach were offered and accepted an exploration permit over this area, to be designated PEP 171.  Award of the tenement, in which Somerton will hold a 25% equity, is subject to Somerton and Beach entering into agreements with the Native Title claimants by September 2013.

PEP 171 covers approximately 550 sq. km of the Casterton fairway in the Penola Trough and is considered by Somerton to be prospective for both conventional and unconventional oil and gas plays. Of most immediate interest to Somerton is the Gordon-1 well which penetrated 243 metres of Casterton Formation and recovered oil from underlying fractured basement.  The Casterton Formation in Gordon-1 contained very good shale source rocks, with TOCs of up to 7.7% measured and up to 20% visually estimated in thin sections. The results of Gordon-1 provide very significant encouragement for the exploration for unconventional oil plays in PEP 171.