Queensland Gas Company (ASX:QGC) Announce 2P Reserves Up By 80 Per Cent

Brisbane, June 19, 2008 (ABN Newswire) - Queensland Gas Company (ASX: QGC)(PINK:QGSCF)(will increase its Proved and Probable (2P) reserves of coal seam gas from 1,317 petajoules (PJ) to more than 2,370 PJ, of which QGC's share would be more than 1,895 PJ.

The upgrade, expected by 30 June after final confirmation by independent certifiers Netherland Sewell & Associates, will represent an increase in the key 2P reserves of about 80 per cent across the Surat Basin acreage.

This latest modelling received this morning from NSAI also shows QGC's Proved (1P) reserves rising from 477 PJ to more than 560 PJ.

The same modelling shows Proved, Probable and Possible (3P) reserves rising from 3,116 PJ to more than 7,100 PJ. QGC has owned 80 per cent of the reserves since completing a key transaction with BG Group on 11 April. BG Group, which is partnering QGC in the Queensland Curtis LNG project to export liquefied natural gas from Gladstone, owns the balance of 20 per cent of the reserves.

QGC Managing Director Richard Cottee said today's interim reserves estimate, which will form part of a Bidder's Statement required for QGC's proposed friendly takeover of Roma Petroleum, highlights the fundamental value of the Company's world-class acreage.

Mr Cottee said QGC's exploration and development programme was accelerated in 2006, giving the Company an edge in the certification of reserves for the Queensland Curtis LNG Project with BG Group.

"We are in this enviable position now as a result of a long and sustained exploration programme starting with the Growth Acceleration Strategy (GAS) in late 2006,'' Mr Cottee said.

"By 30 June 2009 almost half a billion dollars will have been spent on our exploration of the Walloon Fairway, involving drill stem tests, core holes and pilot testing.

"This is a key step in arriving at a Final Investment Decision (FID) in 2010 for the LNG Project with our alliance partner, BG Group.

"Doing a lot of the hard work on reserves early has given QGC a great start with our results ahead of expectations. QGC has drilled 264 wells since November 2000 with 104 wells being drilled so far this financial year, and 200 wells are planned in the 2008-09 year."

The Queensland Curtis LNG Project is being designed to initially supply 3-4 million tonnes of LNG a year to export markets from a plant to be developed at Curtis Island, near Gladstone. QGC has targeted a gas reserve base of 7,000 PJ of 2P reserves to supply the project.