AuDAX Resources Ltd to enter search for Oil and Gas in the Cooper Basin The Directors are pleased to announce that AuDAX has today entered into a Joint Venture Agreement enabling it to earn a 49.9% interest in a very exciting exploration project in the Cooper Basin in South Australia. The joint venture enables AuDAX to participate in the search for oil and gas in one of the country’s most prospective regions at a time when these commodities are very much in demand. The joint venture will add to the Company’s exploration portfolio and supplement the existing and ongoing hard rock exploration programs. AuDAX will earn a 49.9% in the licence from Eagle Bay Resources NL (EBR) by contributing $250,000 towards obtaining Native Title clearances and reprocessing available seismic data over onshore petroleum exploration licence 182 (PEL 182). The Company will maintain the 49.9% interest in the licence by drilling the first three proposed exploration wells planned for the second quarter of 2005. The cost will be capped at $4.5m and thereafter parties will contribute proportionate to the interest held. The licence covers an area of 1,745 square kilometres and is located 60 kilometres north of processing facilities at Moomba, which is 770 kilometers north of Adelaide. Production licences within the external boundaries of PEL 182 are serviced by oil and gas pipelines which should enable early production from any joint venture discoveries. (see attached map). The EBR bid is worth $21.55 million in total and includes 11 oil and gas wells, geoscientific studies and 70 kilometres of seismic acquisition in the first three years of the program. On the awarding of the block, the South Australian Mineral Resources Development Minister Paul Holloway said; “The level of interest in this block reflected the petroleum exploration industry’s faith in the potential of CO 2003-A (PEL 182). The block contains known oil and gas prospects and leads, and abuts producing oil and gas fields. The Cooper Basin remains the preferred onshore Australian exploration investment destination. Between 2002 and the end of August 2004, new entrant explorers were involved in drilling 33 exploration wells. New petroleum pools have been discovered in 18 (54%) of the wells drilled. A respectable 45% commercial exploration success rate has been achieved through this program. In the 30 months to June 2004, the Santos joint venture has drilled 124 new wells, with 90% successful in encountering commercial quantities of petroleum. The new licence will be granted once the ‘right to negotiate’ process has been successfully concluded between the South Australian Government, registered Native Title claimants and the applicant EBR.” It is anticipated that native title negotiations will take approximately six months, during which time the joint venture proposes to acquire the computerised database of all existing seismic and well data relating to the licence area, and produce a detailed prospect by prospect report on the potential of the area prior to the formal issue of the Petroleum Exploration Licence. The estimated budget for this work and the native title negotiations is $500,000. The joint venture partners have agreed to contribute equally to this “initial work” after which AuDAX shall earn its 49.9% interest in the licence A preliminary geological assessment of PEL 182 by Mr Ian Barr B.Sc. Geology included the following; “In the south eastern corner of PEL 182 nine prospects have been successfully drilled as commercial discoveries in a 12km wide corridor between existing oil and gas pipelines. A further 6 smaller but undrilled structures remain to be drilled in this corridor and it is reasonable to expect a commensurate discovery rate would be experienced when EBR and AuDAX drill these structures. Adjacent pipeline facilities should facilitate the early commercial production of discoveries in this corridor. In the north west and north east of PEL 182 larger oil prone stratigraphic traps have been mapped at the pinchout of the Jurassic and Triassic sequence – some of these prospects may require further 3D seismic definition. A project location plan and a more detailed seismic interpretation of the SE pipeline corridor shows discovery oil and gas fields in red and green (these are not assets of EBR or AuDAX) and the adjacent smaller but undrilled prospects in hatching”. Exploration for oil and gas is seen by the Directors as an extension of its existing exploration experience. AuDAX will continue with its ongoing hard rock exploration on existing projects including Millrose, Marymia and Bronzewing South. Yours faithfully GARY J. ROPER Managing Director The information in this report as it relates to mineralisation is based on information compiled by Mr Ian Barr who is a geologist and a Competent Person as described in Appendix 5A to the ASX Listing Rules. The report accurately reflects the report compiled by Mr Ian Barr.
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