(Lakes Oil Group, 100% interest in the overall permit, except for the Trifon and Gangell blocks where Lakes Oil Group has a 57.5% interest and Jarden Corporation Australia Pty Ltd has a 42.5% interest.)
Beach Energy Ltd (Beach) – Delegated Operator for overall Permit.
Under a Farmin Agreement, Beach can earn up to 33.3% interest in the overall permit and Somerton Energy Ltd can earn up to a 16.7% interest).
Armour Energy Ltd has been granted a 3 year option to acquire (subject to the terms of existing agreements with Beach Energy Ltd and Somerton Energy Ltd) 50 % of Lakes Oil Group's interests in the Trifon and Gangell blocks, and a direct 25% interest in the remainder of PRL2, for a total payment of $30 million. Lakes Oil NL will receive option fees totalling $0.6 million during the life of the option.
Planned Future Activities
Wombat - 4 and Boundary Creek-2 Fracture Stimulation
Beach Energy intends to artificially fracture Wombat-4 and Boundary Creek-2 in early 2011. The current plan for Wombat-4 is to initially fracture 3 to 4 of the deepest zones that are representative of the tight gas reservoirs encountered in the well before looking at the shallower zones. In Boundary Creek-2, 3 to 4 fracs will be placed into the 200m thick sand package between 750-950 m.
(Lakes Oil Group, Operator: 100% interest)
No further operational activities have taken place in this permit. The company is still working to resolve access issues to chosen drill hole sites. The matter is currently before the Victorian Civil and Administrative Tribunal.
(Lakes Oil Group, Operator 100% interest)
Under a recently announced agreement Armour Energy Ltd can earn up to a 51% interest in the Permit as follows:
1) drilling Holdgate 1 and the core hole Yallourn Power1 by spending $4.25 million and;
2) in the following 12 months, Armour may expend a further $4.75 million to drill an additional open hole well complete with any necessary frac stimulation.
If Armour Energy Ltd does not proceed with Phase 2 its interest will be capped at 25%.
Map of PEP 166 and PRL 2 showing the location of proposed wells, Holdgate 1 and Yalloum Power
Final interpretation of a short magneto-telluric (MT) survey across the Latrobe Valley region was completed. The results provided new depth estimates to interpreted basement and Strzelecki structuring in this region.
Yallourn North 1A Stratigraphic Corehole: post-drill evaluations, including further geological and geochemical evaluation of the Rintouls Creek Formation, were conducted to evaluate the source and reservoir potential of the Early Cretaceous sequence encountered in this corehole.
Proposed Drilling Program
Two wells are planned by the joint venture for the coming year: An exploration well, Holdgate 1 and a corehole Yallourn Power 1.
Holdgate 1: geological objective is an oil and gas play on the Baragwanath Anticline in PEP 166 where the Rintouls Creek Sandstone/Tyers Conglomerate is the primary objective. A secondary objective is tight gas in the beds of the overlying Strzelecki Group which conformably overlie the Tyers Group.
Yallourn Power 1 corehole: The objective of the well is to drill an offset corehole south of Yallourn North corehole that will be located further downdip into the basin in order to better determine the extent, thickness and prospectivity potential of the basal Cretaceous Rintouls Creek Sandstone.