Sunshine Gas Says Overston 2 Workover Successful

Sunshine Gas reports that the Overston 2 workover has now been successfully completed with all objectives met.

Managing Director, Tony Gilby, said he was pleased that the result was inline with the objectives of the workover and has increased the likelihood of establishing conventional gas reserves for Sunshine Gas in the Overston area.

A stabilized gas flow rate of approximately 500,000 cubic feet per day accompanied by hydrocarbon liquids has been achieved. The gas flow was through a 1" choke and was measured using a "Flow Prover".

Sunshine Gas is now completing studies to assess the reserves associated with Overston 2 and various development options.

The well completion commingles gas from three sandstone intervals being the Basal Sandstone from 3,105 to 3,110m, the Overston Sandstone from 2,995 to 3,005m (which would not flow stabilized rates after hydraulic fracture stimulation), and the Tinowon Sandstone from 2,887 to 2,910m – all of Permian age.

The well has now been shut-in and an extended well test is planned to follow. The well test will be through a separator so that the volume of hydrocarbon liquids being produced can be accurately measured.

Sunshine Gas listed on the Australian Stock Exchange July 3, 2002 with a conventional gas, oil and coal seam gas focus initially on Queensland. More recently, the UK Continental Shelf has been added as a focus area.

The Company has interests in 16 Petroleum Leases (PL's) and 13 Authorities To Prospect for Petroleum (ATP's) in Queensland – including awarded permits and applications - covering an area of over 37,000 square kilometers. In the UK Continental Shelf, the Company has a 50% interest in 9 blocks that are highly prospective for oil.