2008 onshore exploration program starts Victorian Permit PEP...

2008 onshore exploration program starts


Victorian Permit PEP 168, onshore Otway Basin

Essential Petroleum Resources Limited (ASX: EPR) is pleased to advise that the first phase of its
exciting exploration program in the onshore Otway basin permit PEP 168, is expected to commence before the end of March 2008 with the drilling of Ayrford-1. It is currently planned that Ayrford-1 will be followed by East Wing-1.

Essential Petroleum is targeting the onshore extension of the highly productive Pecten High trend, which has produced offshore discoveries containing more than 400 billion cubic feet of gas in the Casino, Henry and Halladale fields.

Essential’s key focus is to drill untested prospects which exhibit similar, seismically defined, direct hydrocarbon indicators (DHI’s) as other, nearby onshore fields.

Gas fields in the Port Campbell embayment area, adjacent to Essential’s PEP 168 permit, including the McIntee, Naylor, North Paaratte and Iona fields have already produced more than 100 bcf of
gas.

Interpretation of an extensive, modern, 3D seismic survey has enabled Essential Petroleum to identify a number of prospects associated with DHI’s that expose the company to potential recoverable gas resources of as much as 40 bcf.

Essential Petroleum’s managing director, John Remfry, said, “PEP 168 is a highly prospective permit which offers exposure to the onshore part of the Pecten High trend. Offshore the Pecten High hosts more than 400 bcf of gas reserves in Waarre formation reservoirs in the Casino, Henry and Halladale fields.

“The Ayrford and East Wing prospects provide us with the opportunity to discover between 10 and 20 bcf of recoverable gas resource.”

Mr Remfry, said, “We are very excited about the drilling program in PEP 168. Proximity to the onshore Port Campbell gas fields and infrastructure gives us a very good chance of quickly commercialising any discoveries.”

“Revenue from the development of onshore discoveries can then be used to offset the cost of future offshore exploration,” Mr Remfry said.

“The company believes that the key to commercial success in PEP 168 is through rapid, low cost development and low cost operations. Gas production could be achieved within 6 to 12 months of discovery.

“Essential Petroleum has identified a number of prospects in PEP 168 with DHI’s similar to many of the nearby producing fields. This substantially increases our chance of making a discovery early in the life of this permit.

“The excellent infrastructure and access to markets in western Victoria ensure commercial viability, rapid development and early reward for discovered resources”, said Mr Remfry.


Essential Petroleum’s leverage to the PEP 168 drilling program has been increased following the withdrawal of joint venture partner, Inland Oil Resources Pty Ltd, from the program due to its heavy drilling commitments in the Cooper basin. Inland Oil will retain its interest in the nearby PEP 151 permit, also operated by Essential Petroleum.

Essential Petroleum will retain 100% ownership of the PEP 168 permit.

Victorian Permit PEP 151, onshore Otway Basin

Essential Petroleum has already started its 2008 exploration program in the Otway basin permit PEP 151 with the acquisition of a 100 km 2D seismic survey which aims to upgrade to prospect status the Digby West and Dartmoor leads in the north eastern part of the permit. .

Mr Remfry said, “ The company has high hopes for prospects associated with the Pretty Hill Formation in this part of the Otway basin, as the play fairways in this area have a good chance of hosting oil.”

Three prospective stratigraphic sequences have been identified in PEP 151.

The oldest sequence, including the Pretty Hill Sandstone reservoir, occurs in the Tantanoola Trough in the north of the permit (Figure 2). The Pretty Hill Sandstone hosts the gas fields and oil accumulations of the productive Penola Trough in South Australia.

The second sequence, including the Flaxman and Waarre formation reservoirs, is the Sherbrook group which will be targeted along the onshore extension of the Discovery Bay High in PEP 151.

PEP 151 allows Essential Petroleum to test the highly prospective Discovery Bay High in an onshore location analogous to PEP 168 and the Pecten High in the Port Campbell region.

The Discovery Bay High is considered to be analogous to the Pecten High, but, since seismic data over the onshore Discovery Bay High area is sparse, the company has acquired 100 km of new 2D seismic data to evaluate the extent of this opportunity.

Oil and gas shows in the Glenaire-1 well, drilled last year in the Penola Trough north of PEP 151, provides significant encouragement for these leads. Additional seismic data is required to mature these leads to prospect status. Essential Petroleum owns 75% of PEP 151 and is operator for the joint venture.Inland Oil Resources Pty Ltd owns the other 25%.