Drillsearch Energy Makes Wet Gas Discovery at Coolawang

Drillsearch Energy Ltd advised that a new wet gas discovery has been made with the Coolawang-1 exploration well. Operations are currently underway to case and suspend the well for cased-hole extended production testing to further evaluate multiple Patchawarra Formation oil and wet gas bearing sands.

Coolawang-1 was the third well in the Western Wet Gas Fairway exploration program which comprises four exploration wells in PEL 106B targeting the Patchawarra and Tirrawarra Formations located on the Western Flank of the South Australian Cooper Basin. Drillsearch Energy Limited holds a 50% interest in PEL 106B and Beach Energy as operator holds 50%.

Multiple Conventional Wet Gas Pay Zones - The well encountered good hydrocarbon fluorescence and gas shows in sands throughout the Patchawarra Formation and Tirrawarra Sandstones. Wire line logging coupled with a formation pressure acquisition program highlighted three hydrocarbon bearing zones in sands below 8,419 feet (2,566 meter) in the Lower Patchawarra. The well did encounter conventional Patchawarra wet gas sands similar to those discovered in the Brownlow Fields.

Successful DST Recovers Wet Gas & Liquids - Subsequently a Drill Stem Test (DST) was run over a 17 feet (5.2 meter) interval of the most promising hydrocarbon bearing interval of the Patchawarra between 8,714 to 8,730 feet (2,656 to 2,661 meters). The DST flowed gas at a stabilized rate of 4.5 MMscfd (1/2" choke) with subsequent pressure data indicating no evidence of depletion. Furthermore, pressures indicate the potential for a 66 feet (20 meter) column of gas, confirming that the sand is a stratigraphic trap analogous to the currently producing Middleton and Brownlow Fields, which are 8 miles (13 kilometers) to the south. The flow also delivered a significant but as yet unquantified rate of high-value 50 degree API gas liquids. No water was evident.

Well Cased & Suspended for Production Testing - Following the successful DST, the Joint Venture has decided to case and suspend the well to conduct cased-hole extended production testing to further evaluate each of identified wet gas bearing zones with a work over rig.

The Coolawang-1 exploration well is located approximately 1.4 miles (2.3 kilometers) north of the Canunda Wet Gas Field (DLS 50% / BPT 50%) and 2.9 miles (4.6 kilometers) west of the Paprika Wet Gas Discovery (DLS 100%). The Joint Venture sees an opportunity to combine this light oil and wet gas discovery with the Canunda Wet Gas field and potentially utilize nearby existing infrastructure to fast track production.

Unconventional Coring Program - In addition thick gassy Patchawarra coals and shales were also intersected. These coal sand and shale intervals demonstrated significantly elevated gas levels and a 98 foot (30 meter) core was acquired for gas desorption studies to determine unconventional gas reservoir potential of these zones.

The Ensign 30 rig will move to the fourth well in the program Haslam-1 in the first week of March.

Drillsearch Managing Director, Brad Lingo said, "This is an extremely exciting result encountering multiple wet gas zones with very high liquid hydrocarbon content. The close proximity of Coolwang-1 to the Canunda and Paprika wet gas discoveries helps build a critical mass to support an expansion of the initial wet gas pilot project which started production in early January 2012."

"We are equally excited about the progress of the unconventional coring program recovering close to 98 foot (30 meters) of coals and shales which appear to have both significant gas contents and potential liquids as well. Additional testing and evaluation work will be required across each of these zones to establish reserves and to determine the produceability of the unconventional zones but this is a very good position to start from."


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