Origin Sees Strong Gas Flows from the Myall Creek 6 Well

Origin Energy reports that the Myall Creek 6 well located in Surat Basin permit PL174 onshore Australia has recorded a gas flow rate of 6.5 million standard cubic feet per day (MMscf/d) on testing of the Tinowon Sandstone reservoir section.

Myall Creek 6 lies significantly outside structural closure of the Myall Creek field (refer attached map). This strong test result confirms that a large stratigraphic trap exists, likely encompassing both Origin's Myall Creek and Mosaic/Santos's Churchie accumulations. The reserves implications as a result of this well are being assessed. Although it is difficult to quantify trapped volumes due to the observed lateral changes in reservoir thickness and quality, proven and probable (2P) reserves being accessed by the current Myall Creek wells are likely to exceed 40 billion cubic feet (BCF). Mosaic has previously cited that its Churchie wells are accessing 33 BCF of proven and probable reserves, making the combined Myall Creek/Churchie accumulation one of the biggest in the Surat Basin.

Origin Energy is planning to record a 3D seismic survey over the area in February 2004, to progress further delineation of the field.

Myall Creek 6 is situated approximately 70 meters north west of Myall Creek 1. The well had previously been suspended on November 21, 2003 after setting 178 mm casing at 2037.0 meters. The casing depth is several meters above the Tinowon Sandstone, which is the primary target of the well.

Drilling operations recommenced on January 25, 2004 with the rigging up of a coiled tubing unit to drill the target reservoir section. Drilling commenced January 27, 2004. The drilling operations were conducted using a nitrified brine fluid system to achieve a formation pressure under balance whilst drilling. Gas bearing reservoir sands were encountered prior to reaching the target total depth January 28, 2004.

After recovering the coiled tubing drilling string, the well was flow tested with a gas flow rate of 6.5 million standard cubic feet per day (MMscf/d) estimated from the flowing tubing head pressure of 1050 psig through a " choke. After wireline logs are recorded, a production packer will be set to isolate the producing zone prior to rigging down the coiled tubing unit. A workover rig will be subsequently used to install the production tubing. A gas pipeline has already been installed to the well site with connection to the Origin Energy gas gathering system expected by March 2004.

The coiled tubing unit drilling program will continue with Myall Creek 7 and Horseshoe 3 to be drilled using the same technique.

Myall Creek 6 is effectively a re-drill of Myall Creek 1, which was drilled in 1964. The gas bearing Tinowon sands in Myall Creek 1 were never tested, and the well was plugged and abandoned.

Origin Energy CSG Limited owns a 100% interest in the well.

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