ggx circulation of materials to shareholders, page-4

from quarterly 29 Jan:


The following first stage work programme commitments for farmin to Petroleum Exploration
Licences 6, 427 and 428 have been previously completed:
The Gwydir 1 corehole was drilled in PEL 6 as a reconnaissance well to determine both:
hn the coal seam gas characteristics of coals within the Triassic Moolayember Formation;
and
hn whether Permian coal is present on the eastern side of the Taroom Trough.
The well intersected 4.0 m of coal in the Moolayember Formation, confirming the extent of
that Formation and providing data to assist with location of follow-up wells. No Permian coal
was intersected.
With completion of the Gwydir 1, ESG has now fulfilled all work programme commitments for
the first stage farmin to Petroleum Exploration Licences 6, 427 and 428.
ESG intends to drill one further corehole within PEL 6, thereby earning a further 25% interest
in the coal seam gas rights of the licence (taking PEL 6 net interest to 75%). A number of
prospective drilling locations to target coals in the Triassic Moolayember Formation and,
potentially, the Permian section have been identified. Two of these locations, Milguy-1 and
Willow Park-1 have been scheduled for corehole drilling commencing in the first quarter 2010.
Further studies are in progress to identify suitable locations in PEL 6 to test the potential of
the Triassic Moolayember Formation and also in the southern region of PEL 427 to evaluate the
extent of Permian coal development.