ajl announcement and mpo glouchester goes off!!! In todays AGM...

ajl announcement and mpo glouchester goes off!!! In todays AGM announcement from AJL

The Gloucester Basin permit provides a great research laboratory for Lucas to test its new drilling
techniques and methodology. The logic behind this initiative was that successful initial
development would not only create a reliable and recurring future earnings stream (by the
development of new drilling technologies) to be offered to the market place in general but, would
create at the same time a valuable asset by proving the Gloucester Basin permit as a significant
gas resource.

Thus far our logic has proved correct.

Phase I is nearing completion and it is fair to say that the resource exceeds our expectations.
While the geology is certainly not straight forward, the Gloucester Basin permit lends itself to
Lucas’ TRD and MRD drilling technologies. The permeability of the coals are some of the best in
Australia but we will not know the full extent of the resource until further work is undertaken.

The
Gloucester Basin permit is roughly the same size as the Australian Capital Territory with 32 coal
seams, 7 of which provide particular interest. Its location sits well to provide gas to both the Hunter
and Newcastle regions as well as the Sydney market.
We are currently undertaking a great deal of engineering and detailed thought as to the next steps
to take in developing the Gloucester Basin permit.