Avery Resources Says Production Started at Toparoa-1

Avery Resources

Avery Resources has been advised by Stuart Petroleum that production has commenced at its Toparoa-1 oil discovery in the South Australian sector of the Cooper Basin. Toparoa-1 initially flowed at 1,570 barrels per day of light (42 degree API) sweet oil and, after well clean-up, it is currently producing 1,980 barrels of oil per day (bopd) plus a 10 percent water cut. Avery has a 32.67 percent interest in the well, providing approximately 650 barrels of oil per day net to Avery at current flow rates.

Avery's partner in drilling Toparoa-1, Stuart Petroleum Ltd., has stated that an electric submersible pump (ESP) has been installed and production is expected to continue at or near current rates. The well produces from the Hutton sandstone formation similar to the adjacent Derrilyn oilfield, 1.3 kilometers to the northeast. With almost the same net pay interval, Derrilyn-1 produced approximately 1,400 bopd, totaling about 500,000 barrels of oil, from the formation in its first 12 months of production.

"We are very excited that Toparoa-1 is producing as expected," said David Little, Chairman and CEO of Avery Resources. "The $1.4 million payment that we have received substantially offsets the delay in production that resulted from the participants' decision to produce the well into the recently completed pipeline, rather than trucking the oil. This production is expected to put the Company over the 600 barrels of oil equivalent per day (boepd) threshold and dramatically improve our cash flow. We look forward to similar successes in Australia as we continue our drilling program in the Cooper Basin."