Press Releases

Tokyo, Nov 27, 2009 (ABN Newswire) - Drillsearch Energy Ltd (ASX:DLS)(PINK:DRLLF) is pleased to announce the completion of its initial independent review of the Unconventional Gas Resource potential of the Western Cooper Unconventional Gas Project.

The project is based on the company's permit holdings in the Western Cooper Basin covering deep coal seam gas resources identified by the company in PELs 106, 107 and 91. The table below (see bottom of release) details the estimated Gas-in-Place and Prospective Resource potential estimated for the project area.

These estimates are the result of an independent review conducted by MBA Petroleum Consultants (MBA), a leading independent Australian energy advisory group. MBA provides specialist geotechnical services to the Petroleum, Coal Seam Gas, Coal Gasification, Geothermal and Greenhouse Gas Storage Industries and are leading technical advisors in coal seam gas.

Prospective Resources under the SPE PRMS classification are as yet undiscovered and as such carry exploration risk.

Through its conventional exploration activity in PELs 106,107 and 91 which includes extensive 2D and 3D seismic coverage and extensive exploration well coverage, Drillsearch has confirmed the presence of thick extensive Permian coal seams which have demonstrated significant gas readings while drilling.

This previous conventional exploration work has provided Drillsearch and MBA with a significant database to undertake the initial unconventional resource potential of these thick coal seams.

The MBA Report has identified key information that is as yet unknown in the Western Cooper Unconventional Gas Project area that is required to demonstrate the potential commercial viability of at least part of these Prospective Resources. This additional information includes gas content, gas composition and permeability of these Deep Coal Seams and as such currently carries significant exploration risk. The MBA Report also outlines a forward program for Drillsearch to acquire this information to further refine and hopefully develop these Prospective Resources into Contingent Resources and commercial reserves.

Managing Director, Brad Lingo stated, "Through our conventional exploration activities in the Western Cooper we have consistently encountered these thick, gassy coals in the Permian section of the Patchawarra Trough and it has long been recognized that these same coals are one of the primary oil and gas source rocks for the entire basin. With this knowledge and understanding we have set out with the assistance of MBA to systematically establish the potential of this Prospective Resource and to define a work program to establish the Prospective Resources in these deep coal seams as a commercially viable unconventional gas resource."

Mr. Lingo added "We already know that Santos has successfully produced gas to surface from these same coals at its Moomba-77 test pilot well and it is our objective to demonstrate that we can achieve these results on a commercial basis throughout the project area. The MBA Report helps put into overall prospective the potential magnitude of the Potential Resource we are dealing with and the upside we can generate for shareholders if we can crack the code in commercially producing this resource."

Drillsearch owns and operates 100% of the eastern portion (503 km2) of PEL 106 and the south west portion of PEL 106 is the Beach Farmin Block held by Beach Petroleum (50%) and the company (50%). Drillsearch also holds 60% of PEL 91 in joint venture with Beach Petroleum (40% and operator) and 40% of PEL 107.

Table:

        Western Cooper Deep Coal Seam Gas
             Prospective Resources*
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Area    Net Coal     Gas-in-Place  Prospective Resource
(km2)  Thickness(m)    (BCF)             (BCF)
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780     16 to >48      10,926        2,731 to 5,463
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* Source: MBA Petroleum Consultants Cooper Basin CSG Potential Prospective Resource Study. Prospective Resource range based on 25-50% recovery factors.