Basker Project Flows First Oil

Anzon Australia has commenced production from the Basker Field in offshore Gippsland Basin, Victoria. The Basker-2 well was opened up at 10:07am on Monday November 14, 2005 and by 11:30 am was flowing oil to surface via a subsea completion and 1.9 kilometer flowline to the Floating, Production, Storage and Offtake (FPSO) vessel, the Crystal Ocean. The initial flowrate from the upper interval (of a completion optionally capable of producing from either one or two intervals), was established at 9,500 barrels oil per day (bopd), with no water production and accompanied by approximately 10 million SCF per day of solution gas. The inlet choke pressure on the FPSO was 1400 psig.

While this development is in 155 meters water depth, 75 kilometers offshore in the Bass Strait, and involves the first FPSO in the Gippsland Basin, the start up of this project highlights an extraordinary achievement in just 12 months since the project initiation and only 11 months since the listing of Anzon Australia.

In the early hours of this morning, after approximately 13 hours of production at an average stabilied flowrate of 10,000 bopd, the FPSO production swivel, which allows the vessel to rotate around the turret mooring, had a mechanical problem. Hence production was shut-in at midnight, the turret mooring disconnected, and diagnostic work commenced to resolve the problem. At the time of writing, the problem has been confined to the two unused production swivels (out of 4) and the required repairs are currently being assessed.

The repairs to the Bow Loading System on the Basker Spirit are nearing completion, and it is expected to be ready to return to the field location on Thursday, November 17th.

The plan is for the Basker-2 well to produce under an Extended Production Test for 6 months, while the optimization of the balance of the Full Field Development (FFD) is undertaken. FFD Production at in excess of 20,000 bopd is expected in mid 2006.

The participants in the BMG Joint Venture are Anzon Australia Limited as operator with 62.5% and Beach Petroleum Ltd with 37.5%.