Bounty Farms Out Seismic Commitment for Sydney Basin

Bounty Oil & Gas has farmed out a 25% interest in PEP 11, its offshore Sydney Basin permit, to UK company Electro Silica plc. Under the terms of the farmout, Electro Silica will fund the acquisition of 1500 km of 2D seismic within the permit to earn a 25% interest. Bounty will be free carried through this program, which is scheduled for the first quarter in 2004.

PEP 11, in the Offshore Sydney Basin, is situated immediately adjacent to the heavily populated and industrialized central coast of New South Wales, Australia. No drilling has taken place in the basin, despite a significant number of wells drilled in the adjacent onshore Sydney Basin, which have flowed gas or encountered oil shows.

Covered by permit PEP 11, a 200 kilometer long, 8,267 square kilometer permit, the Offshore Sydney Basin is a significant under-explored exploration area; with large scale structuring and potentially multi-Tcf gas and condensate-charged Triassic and Permian reservoirs.

Mapped prospects and leads are generally located less than 50 kilometers from Australia's largest energy market, the Sydney-Wollongong-Newcastle greater metropolitan area - a population center of approximately 5 million people.

Bounty has identified a large target located in the northern sector of the permit in an average of 125 meters of water. This structure is situated on the crest of the Offshore Uplift on a thrusted anticline. With a closure of over 120 square kilometers, the feature has potential to hold up to 1.2 Tcf of recoverable gas.

Bounty has completed reprocessing of seismic and aeromagnetic data to mature the mapping in the area. In addition, the prospectivity of the northern sector of the permit has been further enhanced by the confirmation of the presence of apparent hydrocarbon seeps. Originally detected on 1996 satellite imagery, a repeat analysis of 1998 and 2001 images again identified apparent seeps directly over the main prospect. The total depth of a well to test this prospect would be approximately 1,500 meters.