Petsec Increases Production for 2004 by 26%

Petsec achieved net production of 5.7 billion cubic feet of gas equivalent in 2004, a 26% increase on 2003 and within the range of previous indications.

Vermilion 258
(Petsec 83.33% net revenue interest)

Vermilion 258 has three wells on production following completion of the G-7 well which was drilled in October 2004.

Current net production is at the rate of approximately 20 million cubic feet of gas per day.

Completion for production of the G-3 well, which was also drilled in October, was delayed by down-hole mechanical difficulties coupled with bad weather. The company anticipates being able to finish completion operations on the G-3 well by mid-January 2005.

Main Pass 19
(Petsec 45.83% net revenue interest)

A platform deck for Main Pass 19 has been purchased and design for construction of the jacket and deck refurbishment is currently being undertaken.

Due to prior commitments, the rig contracted to drill up to 3 wells at Main Pass 19 is now expected to be available in late January 2005.

West Cameron 343/352
(Petsec 46.125% to 82.33% net revenue interest)

Four wells are on production. Current net production is at the rate of approximately 4.5 million cubic feet of gas per day primarily from the A-14ST, A-17 and A-18 wells.

Onshore Louisiana
(Petsec earning17.5% net revenue interest)

The first well is drilling ahead and is expected to reach target sands in two weeks.

The second well, which will test a separate structure has commenced and is expected to reach the first target sands towards the end of February.

St James Parish, Onshore Louisiana
(Petsec 50% working interest, minimum 36% NRI)

Petsec has entered into a joint venture for a new 3-D seismic survey over approximately 92 square miles in St James Parish, onshore Louisiana 80 kilometers (50 miles) west of New Orleans. Petsec has a 50% working interest and is operator.

3-D seismic has never been acquired in the area which has high prospectivity for both shallow and deep prospects. The survey area is proximal to four fields which have produced approximately 180 BCF of gas.

Data acquisition is expected to commence early in 2005 and potentially lead to drilling late 2005 or early 2006.

Ship Shoal 184/191
(Petsec 7% overriding royalty interest)

Production resumed following a change of ownership of the leases. Currently two wells are on production. The fields were shut in for much of 2004.