Indo-Pacific Conducts More Tests on Kahili

Indo-Pacific Energy reports that a further flow test of the Kahili-1A/B gas condensate discovery has commenced. The flow test will be for approximately one week, and will involve a larger interval of the gas reservoir than in the original flow test. As in the previous test, associated condensates will be tankered from the site and sold.

CEO Dave Bennett said there were several development options available for the offtake of Kahili gas, LPGs and condensate. The Company and its joint venture partners have entered second stage talks with one of several companies interested in taking the Kahili gas; and are aiming to have a draft contract signed with one of the interested parties within two months; with commercial production starting before end of 2003.

Kahili-1A/B has previously flowed at 5 million standard cubic feet per day (MMSCf/d) and a second well might bring total field production to over 10 MMScf/d. However, successful production for an extended period from Kahili-1A/B is required before any second well would be considered.

Indo-Pacific holds 45% equity in Kahili license PEP 38736, along with Australian companies Tap Oil (30%) and Claire Energy (25%).