Bounty Oil Says New Zealand Prospects Better than Expected

Probable recoverable gas reserves of 1.4 Trillion cubic feet (Tcf) and additional possible recoverable gas reserves of 2.4 Tcf have been estimated in the Toroa structure in the oil and gas permit PEP 38215, held by Bounty Oil and Gas in New Zealand's Great South Basin.

Bounty Managing Director Tom Fontaine said the revised estimates of reserves, produced from recent reprocessing and remapping of seismic and a re-analysis of well log data in the area, were considerably greater than originally expected.

"We have reprocessed all seismic data in the permit and re-analysed the data from a number of exploration wells in the area, including the 1976 Toroa-1 well, initially drilled by Hunt International Petroleum, which we believe intersected hydrocarbons but was unable to test due to mechanical problems." Mr. Fontaine said.

"While we are still finalizing our studies, the preliminary work indicates the existence of considerable probable and possible gas and condensate reserves at Toroa and we're very optimistic about working the field. First-pass mapping in the rest of the permit has confirmed the presence of numerous prospects and leads with substantial oil and gas potential.

"Bounty has since increased its interest in the permit from 33.75 to 35 percent. Our joint venture partners are Hardman Resources Ltd. with 55 percent and Albatross Energy with 10 percent. "As an indicator of our confidence in the prospectivity of the field, we have already commenced discussions with possible gas customers."

Mr. Fontaine said Bounty and its joint venturers were considering drilling a test well in this permit in late 2004.

Partners in PEP 38215 are: Bounty Oil as operator with 35%; Hardman Resources with 55% and Albatross Energy with 10%.