wgp coal seam methane project evaluation

WESTRALIAN GAS & POWER LIMITED


VASSE COAL SEAM METHANE PROJECT EVALUATION COMPLETED
An independent evaluation of the Kaloorup Road #2 Well in the Vasse Coal Seam Methane
Project by Westralian Gas and Power Ltd?s (ASX:WGP) Sydney-based independent geological
consultants has recommended further seismic data be undertaken to delineate extensions of the
known gas horizon as well as the fault/fracture patterns of the area.
Also recommended is the deepening of Kaloorup Road # 2 to the base of the Permian Sue
River Coal Measures to determine the gas content of the lower section.
During the drilling of Kaloorup Road #2 rock chip samples were taken every three metres with
selected samples every metre. Ten of these samples were submitted to the laboratory for
analysis and of these, three samples showed methane gas readings significant enough to
warrant further work. These results have added support to the belief that significant amounts of
methane may be reservoired in the Sue River Coal Measures.
WGP Managing Director Stephen Thomas said that this lends weight to the possibility that
there is a significant amount of gas in the sandstones above and between these coal measures
and if this is the case, the prospect now becomes one of both CSM and tight gas in sands
(unconventional gas). Further it appears that there are zones within these sands which exhibit
improved porosity due to grain size and environment of deposition along with lateral weakness
allowing fracturing to be more prevalent. This would account for increased gas readings within
certain sections of a single sand unit.
Following the next generation of seismic and its interpretation it is also recommended that a
number of stratigraphic bore holes be drilled along the seismic traverses to investigate the gas
potential of the faulted and fractures sandstone strata of the Sue Group
WGP?s primary focus in the onshore southwest is to explore for natural gas contained in coal
seams (CSM) and the surrounding sandstone. These units occur at a depth of between 90 to
140 metres and continue to a depth of approximately 700m. This geological member is known
as the Sue River Coal Measures and is made up of Permian sediments of coal measures and
sandstone.
The Kaloorup Road #2 well was drilled in March 2010 to test the Willespie Formation, the
Redgate Coal Measures and the Ashbrook Sandstone for methane. The well twinned an old
coal bore hole known as BHP Busselton 1 drilled in 1974 which intersected the upper coals of
the Permian Sue River Coal Measures. It was noted in the official mines report that during the
drilling that ?a small pocket of gas under light pressure was found to be associated with a small
fracture at 336.60m?.
The Whicher Range Gas Field is 20 kilometres south east of the Kaloorup Road prospect and
these wells are over 4,000 metres deep. The gas in these wells was determined by earlier
explorers to occur in the upper portion of the Sue River Coal measures.
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Westralian Gas and Power Limited ABN 53 109 213 470
WGP?s extensive seismic coverage has shown that a number of small structural highs exist
throughout the area oriented in a north south direction sympathetic with the main faulting
pattern.

PETER BRIGGS
EXECUTIVE CHAIRMAN
11 NOVEMBER 2010