Mosaic Makes Substantial Find At Queensland Well

Mosaic Oil NL has made a discovery at Downlands No 3 well in the Surat Basin, southern Queensland that could be worth more than A$40 million. The company said the potential recoverable oil, discovered on May 27 in Production Lease 119, down to a depth of 1,640 meters could be in the region of two million barrels. "Since oil is also present at 1675 meters in a different prospect several kilometers away, the possibility of oil in the Tinown sandstone around Downlands below 1641 meters sub-sea is high," Mosaic said. It said that testing had also indicated that the Downlands field would be developed by pumping to surface tanks.

The Downland's oil discovery is Mosaic's second in two years. In June last year the company found oil at Spring Grove No 2 well, four kilometers east of Downlands. "Consequently, combined with the Churchie gasfield, the per share fully diluted value of the company's present reserves and other assets is (in the view of the directors) in excess of A$0.50 per share," the company said. Mosaic has an 83.33 percent share in the Downlands field and a 71.15 percent stake in the Downlands East field, while Santos Ltd holds 16.67 percent and 28.84 percent respectively.

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