Farmin and share subscription agreement with New Standard...

Farmin and share subscription agreement with New Standard Exploration for
blocks in the Kidson Sub-basin.
PERTH, Western Australia: ARC Energy Limited (ASX: ARQ) is pleased to announce
that it has further consolidated its position in the Canning Basin with the acquisition of a
significant portfolio of interests in the southern part of the Basin. The new acquisition covers
some 65,000 square kilometres, nearly doubling the size of ARC’s existing total Canning Basin
portfolio and providing access to new play types in a highly prospective area.
ARC has acquired interests in five blocks, consisting of 4 permits (EP 442, EP 443, EP 450
and EP 451) and one application area (App 9/98-9), all of which are currently held by a private
unlisted company, New Standard Exploration Pty Ltd (NSE).
Prospectivity
The newly acquired interests are mainly located in the Kidson Sub-basin of the Canning Basin.
The Kidson Sub-basin contains a unique petroleum system not adequately covered by ARC’s
current Canning Basin interests. This farmin will provide an opportunity to systematically test
the prospectivity of this petroleum system and the Kidson Sub-basin. ARC’s structured
exploration program in the greater Canning Basin covers each of the other major Sub-basin’s,
with this year’s program targeting the Fitzroy Trough in the north of the Basin where the
Valentine well is currently being drilled.
The petroleum system in the Kidson Sub-basin has never been systematically tested, but
several wells have encountered significant oil columns, and the Sub-basin contains a
widespread salt horizon (the Mallowa Salt of the Carribuddy Formation) which provides a
regional top seal to good source and reservoir rocks beneath. Similar petroleum systems in
the Middle East are extremely prolific. Further details of the geological prospectivity of the
area are set out in the appendix.