Australia's Norwest Energy Updates on Operations at its Upstream Assets

Australia's Norwest Energy NL provided Monday an update on the company's local and foreign operations.

Australian Exploration Program

EP368 and EP426 (Onshore Perth Basin, Western Australia)

The operator of EP368, Empire Oil and Gas NL, has advised Norwest that following the successful completion of the “Black Swan” airborne geophysical survey that it has identified an exciting, high impact, near term drilling prospect named Lockyer Deep.

Lockyer Deep is a medium risk well, targeting between 25 and 134 billion cubic feet (Bcf), with a best case estimate of 58 Bcf. This prospect will be targeting the Kingia reservoir fairway which has been identified following the recent drilling success by AWE at Senecio-3, Waitsia-1 and 2 and Irwin-1, all located in acreage immediately west of EP368. A new and significant gas play in the Kingia Sandstone has been confirmed in the northern part of the Perth Basin which will be further tested to the east of the play with the drilling of Lockyer Deep.

The extent of the play into EP368 remains to be confirmed but the results of the recent AWE Irwin-1 well suggests that the Kingia reservoir fairway increases in thickness to the east and thus potentially into EP368.

Lockyer Deep will also be used to appraise an attractive secondary oil target from the previously discovered oil in both the Lockyer-1 and North Erregulla-1 historic wells where oil was encountered in the Dongara/Wagina sandstone in tight reservoir. The deep gas potential of the Kingia Sandstone was not reached by these wells and as such remains untested.

The reprocessing of more than 249 miles (400 kilometers) of historic 2D seismic data in the vicinity of Lockyer 1 and North Erregulla 1 is nearing completion, with encouraging results which can be expected to greatly reduce structural risk. The improvement in data quality is substantial and offers the potential of providing a significant improvement in the definition of the subsurface structure, and improving confidence in selecting future drilling locations.