Mosaic and Santos to Sell Gas from Churchie Field

Mosaic Oil and its partner, Santos, in the Surat-Bowen Basin Churchie Field have negotiated gas sales for up to approximately 1PJ of gas with delivery starting immediately.

Mosaic 49% (operator) and Santos 51% have signed a gas contract with Santos subsidiary, Santos QNT Pty Ltd, for the supply of 5Tj of gas per day for up to six months starting this month.

The Joint Venture partners are also studying plans to connect the Churchie 2 and Churchie 4 wells with spurlines to the central Churchie gathering station.

Mosaic advised the market late last month that an audit of gas reserves in the Churchie Field indicated an increase of 65% of 2P recoverable gas reserves in the Permian Tinowon Sandstone to 54.9 Billion Cubic Feet.

The audit further indicated a total of 129 BCF (132.8 PJ) of 3P gas reserves.

Dr. Howard Brady, CEO Mosaic Oil N.L. as Operator of the Churchie JV welcomed the contract and commented that active marketing of Churchie gas to commercial interest was continuing. He added that this short term Churchie contract was good news for the LPG Plant jointly owned by Mosaic and Santos.

Dr. Brady said that it has been a profitable two weeks for Mosaic - 'Australia's developing oil & gas producer' - following the sale last week of up to 21 PJ's of gas over the next 5 years to CS Energy.