AMULET OIL FIELD DISCOVERY
Tap Oil Limited (¡§Tap¡¨) provides the following update on the Amulet discovery.
Location
The Amulet oil field discovery is located in Production License WA-8-L, in the Dampier Subbasin,
of Western Australia, 34 kilometers north-west of the Legendre oil field and production
facilities.
Amulet-1
The Amulet-1 exploration well was spudded on 24 May 2006 and drilled to its total depth.
A 26 metre oil column on a water contact was discovered in this well. Oil samples were recovered
and indicate a light oil similar to that produced at the nearby Talisman oil field by Marathon in the
early 1990¡¦s.
A preliminary interpretation of the reservoir indicates that it has the potential to flow oil at rates of
up to 10,000 bopd using a horizontal well. A full core analysis will however be required to confirm
this.
Amulet-1 CH (core hole)
The pre drill planning of this well included the alternative to core the well as opposed to flow
testing it. This is because core data, when combined with pressure testing and sample recovery is
considered to be one of the most effective methods of evaluating reservoir potential and flow
characteristics for a development decision.
Consequently, on 7 June 2006 Amulet-1 CH was drilled and a full 34 meter core section was
recovered. Oil was dripping from this core when it was laid out on the rig floor.
Amulet-2 sidetrack
The Amulet-2 sidetrack well was drilled on 9 June 2006 to test the extent of the Amulet structure to
the south east and investigate the possibility of additional oil reservoirs towards the basin bounding
fault.
This well confirmed both the south eastern extent of the lower oil pool and intersected another oil
pool in a structurally higher sand. This sand contained a 6 metre oil column without a water
contact and better reservoir quality than the lower sand.
The size of the lower oil pool is estimated to be around 24 mmbls of oil in place. Recoverable
volumes of up to 10 to 15 mmbls are estimated at this stage however this will need to be confirmed
in due course when the core data mentioned above has been thoroughly analysed and development
scenarios determined.
Encountering oil in the second sand was an excellent result and it is seismically mapped to thicken
up-dip to the east. Moreover there is potential for yet more oil bearing sands east and up-dip
towards the fault. Establishing the eastern extent of the known upper oil pool and the existence of
additional sands will require another well and the Joint Venture is in discussions on an additional
rig slot at this stage.
Summary
The results of this drilling campaign have been very successful and at this early stage, a
commercial development appears achievable. Tap is enthusiastic at the potential for considerable
additional volumes from the upper oil pool and other seismically mapped events to the east. As the
data is further analysed, Tap will provide updates along with the timing of a follow up well.
Santos did not participate in the original Amulet-1. Should a development decision be made by the
Joint Venture, Santos¡¦s election to back in to this campaign requires it to pay the original well
participants 15 times the cost of Amulet-1 from first oil production revenues. Tap¡¦s pro-rata share
of this is estimated to be around $30 million.
Tap¡¦s Managing director Paul Underwood said ¡§this is an exciting oil discovery at a time of very
high oil prices. Whilst more data is still required, at this stage a commercial development looks
achievable with meaningful additional upside potential should more oil volumes be established to
the east. Further, Tap is extremely well positioned to fund new developments without issuing new
shares with $100m cash at bank and zero debt¡¨.
WA-8-L Participants:
Tap (Shelfal) Pty Ltd (Well Manager) 20%
Santos Limited (Permit Operator) 37.3684%
Kufpec Australia Pty Ltd 42.6316%
