Worth a punt?, page-6

And more............

VICTORIA PETROLEUM NL 2002-04-30 ASX-SIGNAL-G

HOMEX - Adelaide

+++++++++++++++++++++++++
EXPLORATION AND DEVELOPMENT

UNITED STATES OF AMERICA

CALIFORNIA

Victoria Petroleum continued over the past quarter to target oil and
gas prospects in the prolific hydrocarbon basins of California, USA,
a core operations and exploration area for the past four years. The
basins targeted are the San Joaquin and Salinas Basins.

SAN JOAQUIN BASIN
VICTORIA PETROLEUM NL INTEREST: 25.25-100%

The San Joaquin Basin to date has seen production of some 9 billion
barrels of oil and 11 trillion cubic feet of gas from discoveries of
12 billion barrels of oil and 12 trillion cubic feet of gas. The
basin has excellent pipeline infrastructure which delivers oil and
gas to the major coastal based population and industrial centres, in
particular San Diego, Los Angeles and San Francisco.

Natural gas has been an attractive exploration target as the
California energy supply problems of the world's sixth largest
economy will be revisited at some time in the future.

As Australian domestic gas prices approximate US$1.30 to US$1.50 per
gas unit and are less than Californian prices, prospects in the San
Joaquin Basin are a priority, exploration and development investment
for Victoria Petroleum. The excellent local pipeline infrastructure
ensures rapid development of any discovery and delivery to a large
energy consuming market.

Highlights of the last quarter and future events in the company's
active California exploration drilling operations follow.

EAGLE OIL POOL DEVELOPMENT PROJECT - 25.25% INTEREST

The Eagle Oil Pool Development Project is targeting a stratigraphic
trap, containing up to 24 million barrels of oil and 62 billion cubic
feet of gas in the Upper and Lower Gatchell Sandstone. The initial
stage of development of the Eagle Oil Pool is planned to be carried
out by initially re-entering and developing the lower reservoir sand
from the Mary Bellocchi-1 well by a combination of a vertical
sidetrack from casing and reservoir development by horizontal
drilling technology.

In 1986, the Mary Bellocchi-1 well flowed 223 barrels of 42deg API
oil per day and 820,000 cubic feet of gas per day before excessive
water from a poor cement job and migration of fines interfered with
the flow of hydrocarbons.

It is believed that horizontal drilling technology, not available in
the mid 1980's, should solve the engineering problems that occurred
during completion and testing of the vertical well and importantly
result in a three to four fold increase in oil and gas flow rates.
Prior to the re-entry of Mary Bellocchi-1 and commencement of
development operations at Eagle No 1 in May 2001, in excess of 100
barrels of gassy, clean 42deg API oil was produced from the well bore
during clean up operations and tanked.

Regrettably, the May-July 2001 development drilling of Eagle No 1 to
a depth of 4,330 metres measured depth was plagued by mechanical
problems which caused non completion for production testing of the
271 metre horizontal leg drilled within the Upper and Lower Gatchell
Sandstone.

However, interpretation of well data indicates a gross section of 131
metres (net of oil pay 91 metres) was intersected in the near
horizontal well bore over the interval, 4,177 metres to 4,207 metres
(30 metres) in the Upper Gatchell and 4,229 metres to 4,330 metres
(101 metres) in the Lower Gatchell.

This net section ("pay") was noted to have good to excellent porosity
and in spite of the high mud weight used in drilling, indications of
hydrocarbons were present, namely suppressed fluorescence and C1 to
C6 hydrocarbon readings. Of importance is the fact that the pay is
some 6 to 7 times the extent of the combined vertical thickness of
the Gatchell sands encountered in the adjacent Mary Bellocchi-1 well
which flowed 223 barrels of oil and 820,000 cubic feet of gas per day
to the surface in 1986.

This method of proposed completion to recover hydrocarbons to the
surface is not uncommon in the USA.

The technical difficulties encountered while drilling the horizontal
leg have prevented immediate testing of the interpreted 91 metres of
oil pay. In mid August 2001, Eagle No 1 was suspended and cased with
a 4(1/2)" liner string and drill pipe as an intermediate casing
string to a depth of 3,939 metres, 238 metres above the Gatchell oil
zone so that completion and testing of the target Gatchell Sandstone
oil zone with a coiled tubing unit and workover rig can take place.

The resumption of completion and testing operations of the suspended
horizontal well bore in Eagle No 1 is planned to take place in the
second half of 2002 following the completion of the current
engineering analysis, the resolution of a dispute with a joint
venture partner and remaining fellow joint venture partner approvals.
Victoria Petroleum plans to increase its interest in the Eagle
Project.

The drilling results to date confirm that the Eagle Oil Pool
Development Project is essentially low risk in geologic nature. The
commerciality of the oil and gas reserves present in the Eagle Oil
Field is dependent on the oil and gas flow rates that can be obtained
from the horizontal well bores planned to be drilled into the field
following successful completion and production testing of the Eagle
No 1 horizontal well bore.

Subsequent to the suspension of the Eagle No 1 well for future
completion and testing, the drilling rig under contract to Victoria
Petroleum NL was moved to the Kingfisher Prospect, 60 kilometres to
the southeast of Eagle No 1.

Kingfisher Prospect - 32.37% Interest

The Kingfisher Prospect was a multiple target structural trap
interpreted from seismic data to have the potential to contain
significant reserves of oil and gas, within the Mya, Vedder,
Domengine and Cretaceous target sands. Drilling commenced in
September 2001 with the well drilled to a total depth of 4,275
metres.

Although moderate to good gas shows were encountered in the Mya,
Vedder and Cretaceous sands drilled, subsequent wireline logs, and
formation testing indicated the absence of commercial hydrocarbons.

However the wireline formation tester recovery of gas from the
Cretaceous Morris sands at 4,100 metres confirms the migration of gas
through the Kingfisher area and is considered to enhance the updip
potential of the Cretaceous Morris sands in the Raven Prospect 5
kilometres to the east.

Significant oil and gas potential was also considered a strong
possibility for the Monterey Formation McClure Shale sequence in
Kingfisher No 1. Support for the hydrocarbon potential of the
Monterey Formation sequence in the Kingfisher Prospect area is
provided by the strong Monterey Formation gas shows seen in adjacent
wells, the reported Monterey Formation gas discovery of 3 TCF
gas-in-place reported by Tri-Valley Oil and Gas Company at their
Sunrise No 1 well 10 kilometres to the south east and the Monterey
oil production from the Shafter and Wasco areas, 16 kilometres to the
south.

Your company is excited about the recent developments in the Shafter
area where EOG recently announced a 127 development well program
extending their Monterey trend horizontal drilling and fracturing
activity north east to within 10 kilometres of the Kingfisher-Raven
area. Several wells in the EOG area are reported to have flowed in
excess of 1,000 barrels of oil per day.

Within the Kingfisher area, the Monterey Formation trend may have the
potential for up to 22 million barrels of oil or several hundred
billion cubic feet of gas in place based on the extrapolation of
reported oil production from the Wasco/Shafter area on trend to the
south, with the gas estimate based on the potential gas-in-place
reserves for the adjacent Sunrise area, 10 kilometres to the east,
reported by Tri-Valley Oil & Gas Co.

Confirmation of the hydrocarbon potential of the Upper Monterey
McClure Shale horizon while drilling was provided by elevated total
gas readings and gas shows over an interval of 126 metres from 2,393
metres to 2,518 metres with gas readings in excess of 100 units of
total gas in 6 zones with net interval of 32 metres. The gas shows
and increase in rate of penetration through the higher gas peak zones
indicates favourable porosity, confirmed by subsequent wireline logs.

Further confirmation of the potential hydrocarbon potential of the
Upper Monterey Zone was provided by the wireline logs which had
similar characteristics to the logs from the producing Monterey zone
on trend to the south.

Based on the very encouraging results obtained from the Upper
Monterey McClure Shale formation while drilling and post well
evaluation, it is considered that Victoria has a potentially
significant Monterey Formation asset. Full realisation of the
potential oil reserves in the Monterey will require a re-entry of the
Kingfisher No 1 well and the horizontal drilling and fracture
stimulation of the best developed zone in the Upper Monterey McClure
Shale. Victoria Petroleum plans to farmout its share of the costs of
this horizontal drilling program, most likely in second half of 2002.
Industry interest has been expressed in the Kingfisher horizontal
drilling farmin opportunity.

RAVEN PROSPECT - 90% INTEREST

As part of the ongoing exploration program on the east side of the
San Joaquin Basin, it is planned in late 2002 following farmout to
resume drilling with the drilling of Raven No 1 on the Raven
Prospect, 5 kilometres to the north east of Kingfisher No 1. The
Raven Prospect is a seismically defined structural high-side fault
block prospect, interpreted to have the potential to contain up to 75
million barrels of oil and 192 billion cubic feet of gas in multiple
Monterey, Vedder, Allison, Domengine and Cretaceous target horizons.

The multiple hydrocarbon target zones expected in the Raven Prospect
are anticipated to be drilled from 2,000 metres to the planned drill
depth of 3,500 metres.

The Raven Prospect, like the Kingfisher Prospect is considered to be
well positioned in the developing Monterey oil and gas production
trend currently under active development by EOG and Texaco, 12
kilometres to the south.

A Monterey target of up to 22 million barrels of oil or several
hundred billion cubic feet of gas-in-place is considered present in
the Raven Prospect based on the Monterey drilling results at
Kingfisher No 1 and in the three wells drilled immediately adjacent
to the Raven Prospect.

Strong industry interest has been expressed in the opportunity to
participate in the drilling of the Raven Prospect as a result of its
position on the newly developing Monterey Formation producing oil
trend. The first participation agreement by an outside industry
partner has already been signed.

At the time of drilling of the Raven Prospect in mid 2002, Victoria
Petroleum NL plans to have a 34% near free carried interest.

CONDOR, COCKATOO, PIPELINE & VALLECITOS PROSPECTS: 15-100% INTEREST

Adjacent to the Kingfisher-Raven area, Victoria Petroleum has also
delineated the 100 billion cubic feet gas potential Condor and
Cockatoo Prospects as candidates for drilling in the future following
farmout, targeting the Monterey Formation and underlying Cretaceous
Sands.

Victoria Petroleum NL also has a significant 19% interest in the
Pipeline Prospect, situated 8kms to the east of the Bellevue-1 gas
discovery well which blew out November 23, 1998 at a depth of 5,380
metres and estimated rate of 100 million cubic feet of gas and 3,000
barrels of oil per day.

The Pipeline Prospect is currently being evaluated at no cost to
Victoria Petroleum by the adjacent well, EKHO-1 drilled by Tri-Valley
Corporation. The EKHO-1 well is being prepared by the operator,
Tri-Valley Corporation, for additional fracture stimulation and
testing to determine the productivity of the deep gas sands
encountered by drilling recently.

This testing will be of great significance to Victoria Petroleum NL
as our Pipeline Prospect lies within the EKHO Prospect boundaries.
EKHO-1 will provide an effectively free evaluation of the potential
of the Pipeline Prospect, interpreted by Victoria Petroleum NL to
contain up to 2.1 trillion cubic feet of gas and 346 million barrels
of oil.

Your company is confident that in the event of a commercially
successful completion and production testing program at EKHO-1 that
Victoria Petroleum can attract a farminee to drill, complete and
production test Pipeline No 1 at no cost to Victoria Petroleum NL
providing the company with a free carried interest in the well.

The Bellevue discovery on the western side of the basin and recent
Monterey Formation oil production and development activity on the
eastern side of the basin provide support for Victoria Petroleum NL's
belief that significant undiscovered oil and gas reserves remain in
the area of interest covered by the San Joaquin Basin Joint Venture.


MORE TO FOLLOW