brw article . looks very promising

Noticed this on the OIP site today. Don't think this was posted previously. With drilling commencing today or tomorrow, if you are going to buy this is the time to do it. As insurance, net cash still is around the market cap. Remember this floated at 20c last December.

DARLING SPUDS OF MAYBE

Report: Tony Blackie
BRW | 24 Apr 2008 | Page: 75 | The Business End

Northern New South Wales is not noted as an oil-bearing region. But all that may be about to change if an oil minnow has its way.

Despite all the technology available, finding oil is still very much a hit or miss process.

Barry Smith is a petroleum geophysicist with more than 30 years' experience who appears to have a nose for sniffing out hydrocarbons, having racked up a good success rate in oil and gas finds in Australia and overseas.

Now at the helm of a freshly cashed up company, Orion Petroleum, he has set his sights on northern
New South Wales where no other explorers have dared to tread. Smith is betting that the Darling Basin area around the Queensland and NSW border is hiding substantial quantities of oil and gas.

Orion, an offshoot of Eastern Star Gas, listed in December after a $23 million capital raising. The company has existing oil and gas drill sites in northern NSW in the Surat and Bowen basins, which have already provided coal-seam methane.

Smith's team is expected to commence drilling by the end of April on Orion's exploration well Willaroo-1 in the north of the state. He says the site has a potential to delivery 40 million barrels of oil and an estimated 155 billion cubic feet of gas.

He is optimistic about the outcome of the venture after seismic tests suggested the presence of hydrocarbons in both of Orion's primary sites.
"We believe Willaroo-1 has the potential to be one of the most significant wells drilled in the state,"

Smith says. "Not only will it kick-start Orion's two-year exploration program but a commercial discovery at Willaroo will represent the largest indigenous supply of hydrocarbons in NSW. While the Surat-Bowen Basin is a proven and extremely important hydrocarbon province in Queensland, the basin is relatively unexplored south of the border. There is a compelling case driving our drilling
program in NSW, with Willaroo-1 located immediately north of proven gas reserves near Narrabri."

Smith, who is NSW president of the Petroleum Exploration Society of Australia and a member of the Society of Exploration Geophysicists, says the drilling will target two primary reservoirs at a total depth of 2000 metres. The two-week drilling program will cut through Jurassic and Permian-aged reservoirs of natural resources.
Work on Orion's second well, Nyngynderry-1, will start in early June with the first comprehensive test of a hydrocarbon prospect in the Darling Basin region of northern NSW.

Nothing is guaranteed in the oil and gas exploration industry and Smith acknowledges there is about 25 per cent chance of success. "Nobody has been exploring in this area and we have access to the oil rigs," he says. "All it needed was an injection of capital to get in."

Orion's licence also allows for coal-seam gas exploration and the company may also drill on one or two coal-seam opportunities in the area. A significant find is also likely to provide local job opportunities as substantial infrastructure will need to be provided.

Smith notes the Moomba pipeline cuts through Orion's leases, which would make a gas find easier to transport.