Exploration

Cooper/Eromanga Basin Exploration Report

Strategy

Stuart continues to update its prospect portfolio following seismic reprocessing and remapping.  Stuart was the successful bidder for the CO-2009E exploration block in the South Australian area of the Cooper Basin.  The block, now designated PELA 516 is expected to be granted in the second half of 2010.  An evaluation of all leads and prospects in current blocks and new licence areas has been finalised to determine the best ten prospects for drilling in 2010 and 2011. 

A 2D reprocessing project to identify gas signatures from seismic data in PEL 113 has identified several gas prospects one of which will be drilled in 2010.  The results from a similar project in PEL 102 are currently being evaluated.

In PEL 102, a 3D seismic survey was recorded in the Rogan area and an adjacent older 3D survey was reprocessed and incorporated into the Rogan 3D.  Processing, depth conversion and an inversion study have been completed, identifying several oil and gas prospects. 

Remapping of oil leads and prospects in PEL 100 has been completed and the economic justification for an extensive 3D seismic program along the southern licence area is complete.  Acquisition parameters and costs are being compiled before submission to the J.V.

All South Australian Cooper Basin exploration licences (PELs 90, 93, 100, 102 and 113) have now been renewed for a further five year period.

Guaranteed exploration in the Cooper/Eromanga for Stuart will be significantly reduced during the next five years which will allow more time for evaluation of new acreage.  Exploration for oil will aim to replace produced oil reserves, increase the reserves base, increase production rate, cashflow and profitability.  Exploration for conventional and non conventional gas will commence. 

Ten exploration wells are expected to be drilled in the Cooper/Eromanga in 2010/2011.  Seven will be oil exploration wells with four in the new PELA 516.  Three gas exploration wells will be drilled to evaluate conventional and non-conventional gas.  Evaluation will include hydraulic fracturing of tight gas reservoirs and thick coal-seams.  Two of the gas prospects will test the validity of inverted seismic data indicating the presence of gas filled reservoirs.

2008/2009 Drilling Program

2010/2011 Drilling Program

Cooper/Eromanga Basin

Stuart expects to drill two exploration and one development well in the first half of 2010.  The new block, PELA 516 should be granted in the second half of 2010 and it is proposed to drill two exploration wells in the licence before the end of 2010.

In 2011, four exploration wells will be drilled in the first half including two in PELA 516.