New Discoveries Of Magellan

Magellan Petroleum Australia Limited has commenced work on the first well of a three-well exploration program in its Cooper Basin acreage. The Maslins-1 well spudded on August 10, 2002.

Magellan (50% interest) and Beach Petroleum, operator for the joint venture, were awarded Petroleum Exploration Licenses 94 and 95 in the Cooper Basin late last year, after successfully bidding for these two adjacent areas in 1998 under the first round of acreage releases by the South Australian Government in the Cooper Basin for 20 years. Agreements were concluded with the native title claimants in the area, the Yandruwandha-Yawarrawarrka People and the Edward Landers Dieri People, in October last year as a condition of the grant of the PELs.

The joint venture has recently acquired 753 line kilometers of data as part of the Nautilus 2D seismic survey in the permits to better define the prospects and leads that had already been identified from existing seismic coverage of the area. The permits are located on the southern oil-prone margin of the Cooper Basin.

The three-well program comprises the Maslins-1 well in PEL 94 and the Aldinga-1 and Henley-1 wells in PEL 95. The wells are being drilled back-to-back using Oil Drilling & Exploration Rig-30, and Beach Petroleum is operator of the joint venture. Interests in each of the wells are Magellan 50% and Beach Petroleum 50%.

Magellan's move into the Cooper Basin has been part of a wider exploration strategy to position the company in the more prospective onshore and offshore oil and gas basins in Australia. Magellan has two other areas under application in the Cooper basin, PELA 110 and PELA 116, both of which are subject to native title negotiations.

The company also has interests in five permits in the Browse Basin and one in the Carnarvon Basin on the North West Shelf, offshore Western Australia, and two in the onshore Maryborough Basin, Queensland. Magellan is actively seeking farmin partners to participate in the exploration programs on these permits.

This large (8,930 square kilometer) permit is located in the northeastern part of the prolific Carnarvon Basin petroleum province to the east of the Bounty, Mutineer and Exeter oil discoveries which will be developed in the near future. The Nebo oil and Phoenix gas-condensate discoveries are located in adjacent permits to the north.

The company recently concluded a farmin agreement with Tap Oil Limited under which Tap Oil will earn a 15% interest in the whole permit area by contributing to the drilling of the Sheila-1 well. Sheila-1 is likely to be drilled in the first half of 2003.

The Sheila prospect is located in the Beagle Sub-Basin of the Carnarvon Basin and the well will target a series of stacked Triassic sands with a mean potential oil reserve of 112 MMSTB. Magellan is seeking additional farminees to participate in the drilling of the Sheila-1 well. ©

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