Central Petroleum Limited management said that they believed that the positive results of drilling and logging to date at the Johnstone West Well-1 (JW-1) in EP115 might lead to the establishment of a new Western Amadeus oil and gas province. To reinforce the possible oil and gas discovery made by JW-1, Central will drill a new wildcat well, Surprise -1 about 8 km south-southeast of JW-1. Surprise-1, targeting up to 50 MMbbls UOIIP (6 MMbbls fully risked mean UOIIP) is expected to spud in early October 2010 immediately following rig down at JW-1, the transport of the rig to the new site and rig up at the new site. The site works and the drilling location pad are already complete.

Central's acreage, in central Australia, is to the north-west of the producing fields of the well-established Cooper Basin. The managing director of CTP, Mr John Heugh, said today that JW-1 results to date had been very encouraging and that further confirmation of the potential will be released over the next week or so.

'We have always known that our 270,000 km2 portfolio in Central Australia has been underexplored and we know that the Amadeus Basin is a proven hydrocarbon province with two fields in production and very little cogent exploration to date,' he said. 'JW-1 is the first ever well drilled west of the Central Ridge which is a major basement feature and it has confirmed that the Johnston Trough is a productive source kitchen.'

A conservative estimate of the incremental Horn Valley Siltstone (HVS) petroleum system potential producing area is 1,400 km2 west of the Central Ridge.

What has encouraged Central Petroleum is that there is no seismic coverage to the west of JW-1 and very little to the south. Therefore the presence of viable HVS source rocks and the frequency of potential structures reservoiring hydrocarbons could be very significant, particularly if it is established with seismic that the HVS source rocks extend to the west into the Mt Rennie sub basin and south into the western platform.

Supporting the company's claims of a potential new petroleum province Mr Heugh said that structures within and on the margins of the Johnstone Trough oil kitchen had become attractive targets, and the western extension of a prospective Ordovician petroleum system is a major breakthrough for Central. JW-1 is probably the most significant well drilled in the Amadeus since the discovery of the Mereenie oil field by West Mereenie-1 in 1963. No other well outside of the Mereenie oil field had shown such strong evidence of an active oil system.

In addition, Mr Heugh said that Central was basing its exploration drilling for oil and gas on modern comprehensive seismic and geological data, unlike the early Amadeus Basin discoveries which were made largely on surface outcrop patterns and/or limited seismic. A 2004 report by the Northern Territory Geological Survey, (the'Faultseal' report), concluded, inter alia, that of the 33 purely exploration wells drilled in the Amadeus to date, 13 had been drilled off structure, mainly due to a lack of seismic definition. 'It is imperative that the Company has access to comprehensive seismic data going forward in any potential field developments surrounding the Johnstone West-1 and Surprise-1 wells; especially 3D seismic, which has been applied so successfully in the Cooper Basin in recent years' said Mr Heugh today.

Further interpretation of the potential commercial significance of hydrocarbon shows at JW-1 is dependent on further assessments via electric logging, pressure and flow testing. No conclusions can be reached as to the commercial potential of the Johnstone West prospect until these further assessments are completed. Further 3D seismic assessment and additional drilling may be required to evaluate the commercial significance of any possibly successful flow testing of JW-1 but the excellent oil shows discovered to date of 'live' oil have proved the existence in the area of an active petroleum system, the Horn Valley Siltstone, dramatically increased the prospectivity of the western Amadeus Basin, underscored the potential of the next planned well, Surprise-1, and pointed the way to the potential for an emerging new petroleum province.

Central is Operator and holds a 90% interest in EP 115, through wholly-owned subsidiary Frontier Oil & Gas Pty Ltd and Trident Energy Limited conditionally holds a 10% interest in the permit.

Tags: Central Petroleum Limited