just out

ASX ANNOUNCEMENT ASX CODE: CTP
14 December 2010
TO: The Manager, Company Announcements ASX Limited
CONTACT: John Heugh +61 8 9474 1444
SURPRISE-1 DEMOBILISATION
Central Petroleum Limited (ASX:CTP) (?Company?), as Operator, provides this update for the Surprise-1 well.
The Company announced on 6 December 2010 that at 1350 CST on Sunday 5 December 2010, an unplanned incident occurred whereby the monkey board and 129 stands of racked drill pipe twisted around the rig mast by 30 degrees whilst the wireline sheaves were being repositioned.
After further investigation, it was found that the monkey board was damaged beyond repair so a new monkey board was required to be supplied and installed which it is estimated could be completed on 31 December 2010.
After considering all reasonably available viable options and evaluating potential costings the Company?s most prudent option, inter alia, in light of the imminent wet season at the well location (which could cause significant standby costs), is to set plugs to suspend the well for re-entry at a later date and to demobilise the entire Surprise?1 drilling operations-spread of contractors and equipment. Analysis of long range weather forecasts and the state of the current weather throughout the Northern Territory indicate to the Company that there is a significant risk of weather causing flooding of the main access road from the rig site to Alice Springs which historically has been cut during the wet season for over six weeks at a time.
In accordance with the Northern Territory Department of Resources approval conditions it is planned to set bridge plugs in open hole and inside the casing to secure the well.
The Company has had to necessarily terminate the contract of the drilling contractor for performance related issues arising out of or in connection with the above referred 5 December 2010 incident.
The Company looks forward to continue the drilling of the Surprise-1 well in addition to other oil prospects and a gas condensate and helium prospect commencing in the first half of 2011 contingent on a number of factors including availability of appropriate crews and equipment.
The results of the Surprise-1 well to date included four zones of oil shows in the Stairway Sandstone above the main Pacoota Sandstone target zone, three of which showed live oil and were to be flow tested but equipment problems related to a contractor?s testing tool becoming stuck prevented this.
John Heugh
Managing Director
Central Petroleum Limited