Drilling Commenced at Petsec's Marathon Well

Petsec Energy advised that a fourth development well has been spud on the Marathon gas/condensate field, located in the shallow waters of the Atchafalaya Bay along the Louisiana Gulf Coast, USA. The well was spud Oct. 22, 2012 using the Parker 76 drilling rig.

The planned 19,400 feet (5,915 meters) well is situated in approximately 8 feet (2.4 meters) water depth and is located 2,100 feet (640 meters) from the nearest well location, the Marathon #2 (State Lease 20369 #1). In addition to testing the known field pays, the well will also test deeper exploratory reserve potential on the Marathon structure. Drilling operations are expected to take approximately four months to reach total depth, log and complete. Petsec's estimated net cost to drill, log and complete for production is $2.0 million.

The Company expects that available production capacity for the Marathon field will be further increased to accommodate increased production from the wells.

Participating working interests in the well are:

• Petsec Energy Ltd 8.00%
• Apache Corporation 48.75%
• Private Companies 43.25%

Details of the well:

• Well name: State Lease 20369 No. 2 well
• Water depth: 8 feet (2.4 meters)
• Proposed total depth: 19,400 feet (5,915 meters)
• Estimated time to drill, log and complete: 120 days
• Operator: Private company
• Petsec working interest: 8.00%
• Petsec net revenue interest: 5.84 %
• Estimated net drilling cost to Petsec: $1.4 million
• Estimated net completion cost to Petsec: $0.6 million

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