cleaning up resistance, page-2

Mozz - all good - more acreage to explore.
Here it is.
Lots of buys gone through at .52 since pre. Will come back strong again.
Orchard Petroleum Limited
ABN 25 061 655 463
19 May 2005
Joint ASX and Media Announcement
Turk Anticline—New Exploration Project in California
Orchard Petroleum Limited (ASX; OPL) (Orchard) and Orchard Petroleum Inc. (OP Inc), a
wholly owned subsidiary of Orchard, are pleased to announce that OP Inc has secured up to a
50% working interest in an exploration play known as the Turk Anticline Project.
Turk Anticline Project
This project is located in OP Inc’s core operational area in the San Joaquin Basin in California.
The Turk Anticline project area is located in Occidental Petroleum acreage immediately adjacent
the giant Coalinga oil field (900 mmbls of oil) in the northern part of the basin.
Orchard Petroleum Limited
ABN 25 061 655 463
OP Inc has been able to secure an interest in this project at “ground-floor” participation where it
expects to drill at least two exploration wells this year. The project area is covered by 3D seismic
where several prospects are ready to drill. The prospects are both oil and gas with multiple
targets in each well. The prospects range in size and there are targets up to 100 bcf of gas and 20
mmbls of oil. The first prospect to be drilled has a mean reserve potential of 0.6 mmboe and
upside to 2.0 mmboe while representing a low risk impact target for the first exploration well in
the area. The second well to be drilled has a reserve potential over 25 mmboe.
The project area covers approximately 32,000 acres with about half Occidental Petroleum fee
acreage and the balance leased. Occidental Petroleum has the right to participate in any wells
with up to a 50% working interest and there is no carried position. OP Inc’s commitment is to
drill two wells this year after which it can decide whether to pursue the project more
aggressively in future years. OP Inc have budgeted to spend some AUD$1.0 million on this
project in the 2005 calendar year.
The Project
The Turk Anticline Project is based, in part, on a high quality, 1998 proprietary 3D survey
covering 50 square miles, which has delineated multiple gas and oil prospects over numerous
reservoirs ranging from shallow to deep targets. Large structural closures up-dip of gas
shows/pay have been identified at the Cretaceous and Eocene levels. Smaller amplitude
supported stratigraphic traps have been mapped at multiple levels within the Temblor formation.
These prospects tie to adjacent areas on the survey that have proven to be productive. Numerous
shallow, channelized features with amplitude and AVO/AVA anomalies have been identified
within the Pliocene Etchegoin interval and comprise a series of low risk gas prospects. The
mixture of these low risk exploration plays combined with the higher impact/higher risk plays
provide a good risk reward profile for the project where the economic returns on a risk adjusted
basis are very solid.
The high Net Revenue Interest (NRI) which ranges from 76.0-77.5% combined with abundant
infrastructure materially enhance the economics. In the event of success this project would have
a material impact on Orchard’s valuation.
OP Inc will have a 25% – 50 % interest in the project area. The ultimate level will depend on
whether Occidental Petroleum decides to participate. OP Inc’s other partner and operator of this
project is Matris Exploration Company that will also own 25%-50%.
Comments
This new venture represents a high quality project initiative that has significant upside potential.
The acreage is covered by 3D seismic and the prospects have been recently high graded and are
ready for drilling. The prospect area is adjacent to one of the largest fields in North America and
hence exploration risk is regarded as moderate.
Orchard Petroleum Limited
ABN 25 061 655 463
The Turk Anticline project, combined with OP Inc’s current operations in California, continues
to increase OP Inc’s position in this highly prospective area. OP Inc now has several projects
that are at various stages of the petroleum cycle, through exploration, appraisal and development.
This project in particular has good scope for follow on drilling in the event of early success.
To get access to prospective acreage in a highly petroliferous area that is covered by 3D
represents a good achievement for a small Australian exploration company. These attributes
combined with high energy prices, favourable fiscal terms and low sovereign risk provide an
optimal risk/reward profile for Orchard shareholders in an area where it has developed a strong
operational base.
Projects
Orchard now has a host of project areas that have been accumulated over the past 4-5 years and
is well positioned to take advantage of the surge in activity in the oil and gas sector. Orchard’s
current projects include:
South Belridge (Sledge Hamar): Free carried up to US$28million on Oil and Gas exploration,
appraisal and development. Five wells have recently been drilled and all are subject to testing
operations.
Southeast Lost Hills “Gas” (Jack Hamar): Gas exploration and appraisal, where five wells
have been drilled to appraise the Jack Hamar gas discovery.
Southeast Lost Hills “Oil”: Oil exploration in the deep Monterey has already begun with the
Jack Hamar 1-1 well that will be starting a testing program this month.
Forbes Gas Project Sacramento: OP Inc has two discoveries, Larner and Wallace. Larner is
on production and Wallace is still testing. OP Inc will drill at least three wells here commencing
in August this year.
McCormack Road (NW Rio Vista). OP Inc has a very large interest in the initial discovery
well that is waiting on some work over activity.
Turk Anticline: Project as discussed above
For further information please contact Mr Steve Graves on 0011 1805 4694656.
The geological information included in this announcement is based on information
provided by Mr Edward Duncan, a qualified geologist employed as a technical consultant
to the Company. Mr Duncan has practiced as a geologist in the petroleum industry for
over 20 years. Mr Duncan has consented to the inclusion of the geological information in
this announcement in the form and context in which it appears.