re: Ann: Market Briefing - Strategic focus fo... some extracts...

re: Ann: Market Briefing - Strategic focus fo... some extracts of the interview below...

What are your plans for the next 12 months?
Peter Henderson
We currently plan to complete two CSG core wells, three CSG lateral/pilot wells, and a conventional exploration well.

Given the delayed start to the program, we have deferred one of the three planned core wells so that we can keep the more important lateral/pilot and conventional wells on schedule. The lateral wells will further demonstrate the productivity of the coal seams as well as provide gas supply for local sales when production assessment and production licences are approved. Currently we have 411Bcf of 2P and 2,443Bcf of 3P CSG reserves.
Parallel with the drilling program we are seeking approvals to allow us to sell gas locally and position the business for production growth over the next few years.

What are your plans for drilling the Greater Mackellar structure and how large is this structure?
Peter Henderson
Right now we’re analysing the successful seismic data captured late last year. This data will help us to better define the structure before drilling of the Rosella-1 well starts. Our plan is for drilling to occur over the May to June period.
With an Original Gas In Place of 1.3 Tcf, the Greater Mackellar structure is a very large prospect.
It’s also worth noting that unlike other CSG companies Metgasco also has this and other conventional gas opportunities.

What are you looking to achieve from the 2013 work program?
Peter Henderson
Our overall objective this year is to take Metgasco from the exploration phase to the production/commercial phase. In addition, we aim to better understand the geological structure in our licence areas.
The Clarence Moreton Basin in Northern New South Wales is an extension of the Surat Basin in South East Queensland. The Surat Basin has been prolific for CSG and conventional oil and gas. It’s worth noting that unlike the CSG fields in Queensland, our wells produce very little water, which is important for the commerciality of wells.
Excluding any allowance for Metgasco’s conventional gas prospects, we already have one of the largest uncontracted 3P reserves base in eastern Australia. Our exploration and appraisal activities over the next few years should allow us to further increase these reserves.
Over the next 12 months we are aiming to further demonstrate commercial flow rates/well productivity and commence local gas sales by year’s end. One of our short to medium term goals is to provide competitively priced natural gas to local businesses. Natural gas has the potential to displace higher cost imported supplies of LPG and diesel.