Indo-Pacific Sees Good Results from Kahili-1B Well

Indo-Pacific Energy Ltd. announces that flow testing of the topmost 50 feet of the Tariki Sandstones in the Kahili-1B well has commenced. Casing was perforated over the interval from 9264 feet to 9314 feet, and during a 2-1/2 hour flow period, despite flow being constrained through a 1/2" choke, the well flowed at rates of 5 million cubic foot of gas per day. Further improvements in well productivity are expected as the well continues to clean up, and is flowed on larger choke sizes. From the color of the flare and the oil produced during initial flow, the gas is rich in condensates (light, premium value oil), although at this time no stabilized ratios of gas to condensate are available. Following a pressure buildup survey; a multi rate test of the well will be conducted, consisting of 8 hour flows on four different choke sizes, followed by a 72 hour pressure buildup, to provide data relevant to long term productivity and reserves.

The Kahili-1 site is situated 2 1/2 miles from a pipeline tie to Swift Energy's TAWN processing facilities, and 5 miles from a similar tie-in to Todd Energy's McKee processing facilities; while a potential tie to NGC's raw gas pipeline is a similar distance. Proximity to 33kV power lines also offers the opportunity to use gas for electricity generation. Both the New Zealand gas and electricity markets are presently undergoing strong market growth, with corresponding strengthening in gas and electricity prices.

Indo-Pacific CEO David Bennett commented, "We are very pleased with these initial flow results; and following completion of our flow tests we will be working with our partners to bring the Kahili field into profitable production without delay."

Indo-Pacific Energy Ltd., through two subsidiary companies, holds 45% of Kahili and the PEP 38736 permit, and is operator of the project. A further release will be made upon completion of flow tests in five days time.