Petsec: Mobile Bay Discoveries Now Total 18 Bcfe

New exploration leases acquired seven months ago in the U.S. Gulf of Mexico by Sydney-based Petsec Energy Ltd, are proving to be a gas bonanza for the Australian company.

The latest success at Mobile Bay 944 No 1 well, announced by Petsec Energy Monday, means that the Company has now discovered a total of 18 Bcfe net from the six wells drilled to date from a package of 33 new leases acquired by the Company in the Gulf of Mexico in September last year.

Petsec's Executive Chairman, Terry Fern, said that the Company was already looking at acquiring additional leases in the Mobile Bay area.

"The Mobile Bay area is proving to be very lucrative for the Company, especially considering the quick turnaround to production and cash flow from these new leases," Fern, said. "This latest success means that our six consecutive Mobile Bay discoveries have added a net 18 billion cubic feet of gas to Petsec's expanding reserves base. Significantly, because of the short term discovery-to-production cycle in these shallow water areas, we expect to bring gas from these six discoveries into production early in the third quarter of the current calendar year."

Details of the successful well are:

--Well name: Mobile Bay 994 #1
--Water depth: 29 meters (97 feet)
--Total depth: 2,517 meters (8,256 feet) measured depth
--Operator: Royal Exploration Co., Inc.
--Petsec working interest: 50% before payout (40% after payout)
--Petsec net revenue interest: 39.42% before payout (30.53% after payout)

In the U.S., Petsec Energy has a portfolio of 51 leases in the Gulf of Mexico, and the Moonshine Project onshore Louisiana with 3D seismic mapped prospects of 290 Bcf of gas and 30 million barrels of oil (net to Petsec).

Petsec Energy Ltd is an independent oil and gas exploration and production company listed on the Australian Stock Exchange. Its focus of operations is on gas in the shallow waters of the Gulf of Mexico and onshore Louisiana Gulf Coast region of the U.S. and on oil in the shallow waters of the Beibu Gulf off the south coast of China.

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