Beach Gets Production Test Results on Middleton & Udacha

Beach Petroleum reports that interpretation of the results of extended production testing of the Middleton-1 and Udacha-1 wells indicates gross Proved and Probable Recoverable Sales Gas Reserves of:

Middleton 6.3 PJ
Udacha 3.4 PJ

The Middleton and Udacha gas discoveries are located in the South Australian Cooper Basin, approximately 50 km northwest of Moomba and 6-12 km from the nearest existing gas infrastructure. Development of the fields and commencement of gas production is now subject to negotiation of gas sales agreements and/or access arrangements with respect to exiting infrastructure.

Middleton-1 was drilled in February 2006 and flowed gas on Drill Stem Test (DST) at rates of up 12 million cubic feet per day (mmcfd) from the Patchawarra Formation. Production testing indicates that similarly high rates can be achieved from Middleton-1 when sales commence. Udacha-1, also drilled in early 2006, flowed gas on DST at approximately 0.4 mmcfd. However test results indicate that rates in excess of 2 mmcfd should be achievable with fracture stimulation.

Beach considers that the Middleton/Udacha area has high prospectivity for further high deliverability gas discoveries. A 180 sq km 3D seismic survey will be acquired in this area in early 2007, to be followed by further exploration drilling later that year.

Participants in Middleton are Beach Petroleum as operator with 50% and Great Artesian Oil & Gas with 50%. Participants in Udacha are Beach Petroleum as operator with 15%; Great Artesian Oil & Gas with 32.5%; Magellan Petroleum with 30%; Enterprise Energy with 12.5%; and Rawson Resources with 10%.