independent unconventional valuation

1st part as below then 52 pages after.

INDEPENDENT UNCONVENTIONAL VALUATION
Central Petroleum Limited (ASX:CTP) (?Central? or the ?Company?) has pleasure in releasing
an interim independent valuation of the Company?s unconventional gas and oil resources by
Mulready Consulting Pty Ltd with contributions by Holt Campbell and Payton Pty Ltd and
DSWPET Pty Ltd. The valuation report is attached to this announcement.
The preferred valuation for the upstream component (exploration and potential production) of
the fully risked prospective resources in Central?s acreage in the Amadeus and Southern
Georgina Basins is $412 million while the preferred valuation for the proposed downstream
component (ultra-clean transport fuel production from Fischer Tropsch GTL plant) is $5 billion,
should gas discoveries prove sufficient to supply the 5TCF of gas which would be required. 59
TCFG and 6.1 Bn.bbls prospective resources at ?mean? level have been estimated by
independents DSWPET Pty Ltd in previously announced reports in the Central?s Amadeus and
Southern Georgina Basin unconventional acreage
These valuations are based on very early stage exploration generally in Australia for
unconventional petroleum and will warrant re-visiting as more transactional, exploration and
possible production data become progressively available.
?Interest in Australian unconventional acreage and recent farmin deals into unconventional
acreage have escalated considerably which has been confirmed with the BG Group?s farmin to
Drillsearch?s Cooper Basin acreage imputing a valuation of approximately $300/net acre? said
Central?s Managing Director Mr Heugh today. ?It is noteable that the Drillsearch farmout to the
BG Group was a much smaller acreage but a much richer deal than previous unconventional
farmout deals in Australia which collectively have imputed values ranging from approximately
$10 to $35/net acre. Clearly, if further exploration brings success, the implied valuation of
farmout deals per net acre of promising Australian unconventional acreage may gravitate closer
to the far more lucrative North American valuations.?
In order to maximise shareholder value, Central aims, inter alia, to selectively and progressively
farmout portions of its vast acreage to different companies on successively better terms as
exploration success in and around the Company?s acreage progresses. Both Rodinia and
Petrofrontier have current drilling programmes in areas close to Central which may de-risk the
Company?s acreage should those companies have exploration success. The Company does not
wish to enter in to early broadacre deals over all or most of its acreage with the one company
Drilling Update
The Company is planning contingently to re-enter the Surprise-ST1 well late September 2011 to
accelerate a programme over the next 6-12 months focussed on re-entry and testing of
Surprise-ST1 (10 MMbbls UOIIP-P50) for oil potential in both conventional and unconventional
horizons. Significant oil shows were encountered in several horizons in December 2010 and
based on porosity and permeability measurements, a 9m cored section with abundant oil shows
was reported by RPS Energy to be capable of flowing between c.500-1,000 bbls/day subject to
sufficient oil saturation.
Access road and drill pad maintenance and upgrading is well advanced and a contract with ADS
Rig 6 is being finalised.
Central is planning to test both the conventional and unconventional potential of the Surprise
structure. The Surprise prospect has geological parallels to the geology of the Mereenie field,
which is believed on discovery had over 300 MMbbls of oil in place of which less than 10% has
been extracted to date, the hydrocarbon column being dominated by tight sands, siltstones and
shales with minor intervals of highly permeable sandstones with prolific production rates.
Other wells planned before the year?s end incude the drilling of Mt Kitty-1, a large
condensate/helium/gas prospect (UGIIP 2 TCFG, 100 BCF helium-P50) and the drilling of
Madigan-1, the first well on a giant structure in the Pedirka Basin thought to have UOIIP
potential of over 4 billion barrels (P50) based on preliminary mapping of new seismic acquired in
2010.
John