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\\SUNRES01\Users\Jmv\My Documents\Sun Resources NL\ASX\Thailand L20 50 Block Award 40108.Doc
SUN RESOURCES NL
ABN 69 009 196 810
(INCORPORATED IN WESTERN AUSTRALIA)
Unit 16, Subiaco Village, 531 Hay Street Email: [email protected]
SUBIACO, WA 6008, Australia Telephone: 61 8 9388 6501
PO Box 1786, WEST PERTH, WA 6872, Australia Facsimile: 61 8 9388 7991
Monday, 7 January 2008
ASX Announcements
Australian Stock Exchange
Level 4, 20 Bridge Street
SYDNEY, NSW 2000
RE: L20/50 ONSHORE BLOCK THAILAND - AWARD
Sun Resources NL (“Sun Resources”) and Carnarvon Petroleum NL (“Carnarvon”) have
received official notification from the Thai Department of Mineral Fuels (“DMF”) of the
award of onshore block L20/50 and in turn have accepted the block award from the DMF.
It is anticipated that contractual documentation for the block between the joint venture and
the Thai government will be signed latter this month in Bangkok. Following the formal
signing, Carnarvon as Operator, will commence block exploration activities.
Background to Block L20/50
The L20/50 block is a 3,947 km2 block area located in the southern portion of the
Phitsanulok Basin, refer Figure page 2. The Phitsanulok Basin contains the largest
onshore oil and gas accumulation in onshore Thailand, the Sirikit Field, which is on trend
with the southern adjacent L20/50 block. The field was brought onto production in 1981
and to date has produced ~180 million barrels of oil. Current daily production approximates
20,000 barrels of oil, 50-55 million cubic feet of gas and 275 tonnes of LPG. Reserves in
excess on 200 million barrels of oil remain to be produced by advanced recovery
processes under the current high oil price regime.
The L20/50 block has been very lightly explored with the last effort in a time of low oil
prices in the early 1980s. There is the possibility of near term cash flow from a re-drill or
work over of an old shut in well in the block. This well was not brought on production at the
then time of prevailing low oil prices because it required artificial lift to bring the oil to
surface and this higher cost production methodology was not considered by the operator.
Carnarvon, as Operator of the L20/50 block, plans to fast track exploration to reach an
early drilling decision on the block. A similar exploration philosophy will be applied to
exploration on the block in a basin that is a direct geological analogue to the Phetchabun
Basin lying ~50 kilometres to the east of the L20/50 block. Carnarvon and its joint venture
partner Pan Orient Energy have been extremely successful in the Phetchabun Basin in the
last 12 - 18 months in exploring new play concepts, particularly the fractured volcanic play
in the basin. Exploration success here from new field discoveries in the environs of their
Wichian Biri Field has seen production rise from less than 50 to greater than 6,000 barrels
of oil per day.