Vic/P45 GIPPSLAND BASIN: OFFSHORE VICTORIA
50% INTEREST
OPERATOR: EXOIL LIMITED (“Exoil”)
The Vic/P45 Joint Venture consists of:
Exoil Limited 50%
Moby Oil & Gas Limited 50%
Figure 1 above shows the location of Vic/P45 and the legend identifies the relevant features within the basin. For a geological description of Vic/P45 see Section 7 of the Information Memorandum.
Vic/P45 was previously farmed out to Apache Energy Ltd (“Apache”) which drilled, at its cost, the Coelacanth-1 well in Q1 2008. Apache elected to withdraw from any further commitment to drill a second well and is now required to re-convey the farmout interest (66.6668%) to Exoil and Moby Oil & Gas Limited (“Moby”) in equal shares.
Following Apache’s withdrawal, application has been made to the Designated Authority to approve a program of office studies in 2008/2009, to be followed by a well in 2009/2010. The very tight market for offshore drilling rigs has pushed future Vic/P45 drilling activity into 2009/2010.
The remaining prospects are required to be upgraded to drillable status, which is the purpose of the office studies to be undertaken in 2008/2009, preparatory to drilling.
The permit is not subject to Native Title claims.
Budgeted Expenditure – VIC/P45
| Year of Term of Permit |
Summary Work Program |
Exoil's 50% Share of
|
|
Budgeted Expenditure* A$
|
Indicative Expenditure* A$
|
| |
|
2008/2009
|
2009/2010
|
| Year 4 |
Office Studies |
10,000
|
100,000
|
| Year 5 |
Drill One Well |
|
NIL
|
| TOTAL BUDGETED EXPENDITURE 2008/2009 |
10,000
|
|
| TOTAL BUDGETED EXPENDITURE 2009/2010 |
|
100,000
|
| *ASSUMPTIONS: |
That the Designated Authority approves the program as submitted. That is, office studies in 2008/2009 to be followed by a well in 2009/2010.
That the cost of the Year 5 well will be met by farm out or that an election is made not to drill.
|
Vic/P53 GIPPSLAND BASIN: OFFSHORE VICTORIA
16.6667% INTEREST
OPERATOR: STUART PETROLEUM LIMITED (“Stuart”)
The Vic/P53 Joint Venture consists of:
Stuart Petroleum Limited 50.0%
Exoil Limited 16.6667%
Moby Oil & Gas Limited 8.3333%
Cue Petroleum Pty Ltd 25.0% (15% of this interest is held by Cue Petroleum Pty Ltd (“Cue Petroleum”) to meet certain back-in rights held by a third party)
Figure 1 above shows the location of Vic/P53. For a geological description of Vic/P53 see Section 7 of the Information Memorandum.
Vic/P53 has been farmed out to Stuart. As required under the terms of the farm out, Stuart was appointed Operator and drilled the Bazzard Prospect within Vic/P53 which was subsequently plugged and abandoned. To complete its ‘earn in’ obligations, Stuart is required to meet 100% of the costs of two wells in the permit. Having drilled Bazzard-1 as the first well, Stuart has the right to withdraw from the permit without drilling the second well. The Company is presently awaiting Stuart’s decision on whether to drill the second well or withdraw. Should Stuart elect withdraw, the Company’s interest in the Permit would increase to 33.3334%.
Prior to the spudding of Bazzard-1, Stuart paid US$1,150,000 to Exoil and Moby (in the ratio of ⅔ to Exoil and ⅓ to Moby). This enabled Exoil and Moby to meet their pre-existing contractual obligations to Cue Petroleum that relate to an over-riding royalty interest in the permit.
While Stuart remains in the permit, it will assume its pro rata share of the 4% over-riding royalty obligations relating to the Exoil and Moby interests.
Vic/P53 covers an area of 740.2km² and is overlapped by Native Title claim VC97/4 with the extent of overlap being 201.7km². The claim number is Federal Court No. VG6007/98; NNTT No. VC97/4. The name of the group claiming Native Title is Gunai/Kurnai people and the date of registration is 4 April 1997. For further information see the National Native Titles Tribunal website
www.nntt.gov.au
Budgeted Expenditure – Vic/P53
| Year of Term of Permit |
Summary Work Program |
Exoil's 16.6667% Share of
|
|
Budgeted Expenditure* A$
|
Indicative Expenditure* A$
|
| |
|
2008/2009
|
2009/2010
|
| Year 3 |
Drill Two Wells |
NIL
|
NIL
|
| Year 4 |
Data Evaluation |
|
33,333
|
| TOTAL BUDGETED EXPENDITURE 2008/2009 |
NIL
|
|
| TOTAL BUDGETED EXPENDITURE 2009/2010 |
|
33,333
|
| *ASSUMPTIONS: |
Stuart drills two wells as per the farmin terms. In the event that Stuart elects not to drill the second well, the Company will carry out a detailed evaluation of the data from Bazzard 1 and seek to roll over the obligation to drill the second well into Year 4 obligations and, at the same time, seek to farm out the second well obligation to a new farminee.
|