Indo-Pacific Begin Drilling in Taranaki Basin

Indo-Pacific Energy has begun re-entry and drilling operations at the Tuihu-1A well in Petroleum Exploration Permit 38718, onshore Taranaki Basin, New Zealand. The Tuihu-1 well will be deepened from its present depth of 4,530 meters to a target depth around 5,100meters to test the gas shows observed in fractured sands, and the deeper Tariki and Kapuni targets not reached in the original Tuihu-1 well. This should take three weeks to complete.

Permit operator Swift Energy will employ an underbalanced drilling technique designed to flow gas encountered while drilling, and optimize production flow rates in the event of discovery. CEO Dave Bennett said, "The experience we will gain through Indo-Pacific's participation in Tuihu-1A should be invaluable to us in planning and operating our own deep gas drilling projects over the coming two years in other Indo-Pacific operated Taranaki permits."

The Tuihu Prospect is a large structure 3 miles east of Indo-Pacific's Kahili gas field, and 15 miles north of Swift's Waihapa production station, to which the well will be linked in the event of commercial discovery. Subject to statutory approvals, Indo-Pacific holds a 10% share of the Tuihu project and PEP 38718 permit; Swift Energy holds 50%, while Origin Energy and New Zealand Oil & Gas both have a 20% share.

The Company is also very pleased to announce, that it expects the Waiwiri-1 well in PEP 38753, immediately south of Tuihu, to start drilling this week. This will test a Mount Messenger oil target between 4,000 and 4,500 feet depth. Indo-Pacific operates this permit and holds a 30% equity in the well and permit; with Australian based companies Tap Oil and Magellan Petroleum each holding 25% and Krystal Corp a 20% equity.

CEO Dave Bennett said, "This first exploration well using the South Pacific rig heralds an era of cheaper drilling in New Zealand which should result in more wells being drilled in this highly prospective oil and gas province."