'thar she blows...

News Story

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17/03/2003 09:31:44
Joint Release: Mosaic-Santos Welcome Churchie start-up

MOSAIC OIL NL 2003-03-17 ASX-SIGNAL-G

HOMEX - Sydney

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Last weekend gas began flowing into the Queensland grid from the
Churchie field, a joint venture between Mosaic Oil NL and Santos Ltd.

The Churchie gasfield is in Production Lease 192 located to the east
of the town of Surat in southeast Queensland.

The 5-kilometre Churchie pipeline was built by Mosaic as Operator. It
connects into the Santos - Mosaic 120-kilometre pipeline that runs
from Silver Springs to Wallumbilla.

The field will initially supply five million cubic feet of sales gas
a day into the Queensland gas grid.

In this initial phase, Mosaic expects its annual share of product
sales to be approximately $4.2 million.

"The Mosaic team sees the Churchie field as a reward for our basic
decision in the late 1990s to concentrate on the Permian Tinowon
sandstone in this region", says Mosaic CEO, Dr Howard Brady

"The new development is further confirmation that we are moving from
an explorer to a producer".

Santos CEO, John Ellice-Flint said: "We welcome the start of
production from Churchie following the fast tracking of the field
development."

The Churchie field discovered in 2001 is estimated to have proved and
probable reserves of 23 PJ's of gas (2P) with an estimated 100 Pj's
of possible gas reserves (3P).

Interest holders in Churchie JV PL 192 are:

Mosaic 49% (Operator)
Santos Ltd 51%

ENQUIRIES

MOSAIC
Steven Mc Dowell
Company Secretary, Mosaic Oil.
Phone: 9247-9324.

Don Willesee,
Media Relations-Mosaic Oil
Central Communications, Cammeray 2062
Phone: 02 9922 2244
Email: [email protected]
Mobile: 0417 284 564

SANTOS
Kathryn Mitchell,
Media Relations, Santos Ltd
Phone: 08-8218-5260
Mobile 0407 979 982
Fax: 08 8218 5285

Mark Kozned,
Investor Relations, Santos Ltd
Phone: 08-8218-5939
Mobile 0407 747 908
Fax 08 8218 5131