Oilex Says Cambay Field Reserve Estimate Increased

Oilex NL says additional work has been completed to define with a higher level of confidence the characteristics of the reservoir and the fluid composition in potential reservoir units of the Cambay Field. This work has resulted in the following estimates for the Oligocene OS II sandstone and the Eocene EP IV sandstone on both the Western High Trend and the eastern flank, which are two of the main objective horizons targeted in the phase-I drilling program. No estimates for other potential reservoir units in the Miocene and Oligocene have been completed at this point. The estimates announced previously for the Oligocene OS II resource were only for the Western High Trend.

Accounting for the possible presence of oil and /or gas on the eastern flank and the western high trend, the best revised estimate of potential resource original volume in place has now increased by 48% from 29 to 43 million barrels of oil and by 409% from 34 to 173billion cubic feet of gas.

Approximately 52 billion cubic feet of gas has been produced from the eastern flank area. The range of volumes for oil are now 16 to 108 million barrels potential original oil resource in place, with the range of volumes for gas from 105 to 432 billion cubic feet of gas resource originally in place.

The first phase of drilling on Cambay Field is scheduled to commence in the second half of June, depending on the time taken to import additional equipment necessary for the drilling program. As previously advised, on the basis of data analyzed from existing wells, two wells have been optimally located to intersect the possible oil leg on the western high structure to acquire modern wireline and formation fluid and pressure information to aid in normalizing the existing data base.

            RESOURCE                        ORIGINAL VOLUME-IN-PLACE           
                                  Low Estimate   Best Estimate   High Estimate 
OIL (million stock tank barrels)             16              43             108
GAS (billion cubic feet)                    105             173             432
CONDENSATE (million stock tank              1.6             3.7             9.8

Estimates of the potential hydrocarbons originally in place (100% basis) calculated for the Western High trend and eastern flank at the stratigraphic level OS II and EP IV sandstones.

The Directorate General of Hydrocarbons (the regulatory authority of the Republic of India) will be briefed on the outcome of the ongoing resource assessment work.

Oilex is in the process of acquiring a 45% interest in Cambay and is Operator for the Joint Venture.