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MEO Australia Limited
ABN 43 066 447 952
Tel: (+61 3) 9614 0430
Level 17 Fax: (+61 3) 9614 0660
500 Collins Street Email: [email protected]
Melbourne Victoria 3000 Australia Website: www.meoaustralia.com.au
ASX AND MEDIA RELEASE
BLACKWOOD-1 UPDATE
Key Points:
• 2473 Bcf Contingent Resource estimate in Greater Blackwood
• Casting basin site selection initiated to secure construction site for TSMP
MELBOURNE, AUSTRALIA (March 14, 2008) -- MEO Australia Limited (ASX: MEO) provides
the following preliminary Contingent Resource estimates for the Greater Blackwood structure based
on initial interpretation of the Blackwood-1 drilling results.
Blackwood-1 has confirmed 49m of gross Plover gas bearing sands to a preliminary gas-water
contact (GWC) at 3225mMD (3188m subsea). While the actual GWC has not been finalized and
may be deeper thereby increasing the potential Contingent Resource, the GWC is considered
conservative and is the basis for the Contingent Resource calculations provided below. Blackwood-
1 also encountered 13m of gross Flamingo gas charged sands. However, MDT recovery was not
successful in this upper zone due to borehole damage and no part of the Contingent Resource
estimate includes any potential gas in the Flamingo sands.
Structure Raw Gas (including CO2) Contingent
Resource GIP (P50 – “most likely”): Bcf
Blackwood 1428
Blackwood East 1045
Totals 2473
“Contingent Resources” are those resources which relate to quantities of petroleum (oil or
gas) which are estimated to be potentially recoverable from a known accumulation but
which are not yet considered to be commercially recoverable. Contingent Resources may
include, for example, accumulations where evaluation of the accumulation is still at an early
stage and further appraisal drilling is required.
Based on the current assumptions of a 60% net to gross and 10% matrix porosity, it would be
reasonable to assume a 70% recovery factor, which would indicate that Blackwood may offer
approximately 1700 Bcf of raw recoverable gas.
The first methanol plant proposed for the Tassie Shoal Methanol Project requires approximately
1400 Bcf of raw gas (including inerts) to produce 1,750,000 tonnes per annum for 20 years of
operation.
Given the encouraging results from the Blackwood-1 well and indications of a possible gas resource
adequate in volume and quality to supply a methanol plant, MEO has accelerated the selection
process to identify and secure a casting basin site in Southeast Asia for the possible construction of
the concrete gravity base structure. The Company has also initiated the development of the Basis of
Design documentation in preparation for the commencement of Front End Engineering and Design
(FEED) studies for the Tassie Shoal Methanol Project (TSMP) later in the year.
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On December 23, 2002, the Commonwealth Minister for the Environment and Heritage granted
approval for the TSMP to construct, install, commission and operate two 1,750,000 tpa plants until
November 29, 2052.
As previously advised, now that a hydrocarbon accumulation has been confirmed in the Blackwood
structure, further seismic evaluation will be undertaken and a second well will be required to
appraise and production test the Plover sandstone reservoir. The proposed Blackwood-2 well is
likely to be fully cased and may be designed for retention as a future production well.
C.R. Hart, Managing Director
MEO Australia Limited
NT/P68 Operator
Plover depth map corrected and based on the Blackwood-1 results. Blackwood East may
be connected to the main Blackwood structure but further seismic data and processing
will be required to resolve this uncertainty.