Drillsearch Energy Limited (ASX:DLS) Announces Major Increase In 2P Oil And Gas Reserves In Cooper Basin

Sydney, Sep 8, 2010 AEST (ABN Newswire) - Drillsearch Energy Limited (ASX:DLS) (PINK:DRLLF) is pleased to announce a major increase in 2P oil & gas reserves in its core Cooper Basin Western Flank Oil Fairway and Gas & Liquids Projects.

Drillsearch has been advised by Beach Energy Limited (ASX:BPT) (PINK:BEPTF) as operator of PEL 106B within the Western Cooper Gas & Liquids Project that based on the results to date of the current testing of the Brownlow and Canunda Gas & Liquids discoveries that it considers these discoveries along with the Middleton and Udacha Gas & Liquids discoveries commercial.

Beach has announced in its Annual Report a 2P reserves increase of 2 MMBOE based on the testing results for the Brownlow and Canunda Gas & Liquids discoveries. PEL 106B is held by Beach Energy, operator (50%) and Drillsearch (50%)

Based on this assessment, Beach has advised Drillsearch that these discoveries collectively contain 2P reserves of 5.6 MMBOE. Drillsearch's share of 2P reserves in these discoveries is approximately 2.6 MMBOE of which 1.05 mmbbls are liquid hydrocarbon reserves.

As the operator of PEL 106B area of the Western Cooper Gas & Liquids Project, Beach has advised Drillsearch that it considers these discoveries are commercial and pending development. The effect of this assessment and the results of the extensive testing programme on these discoveries has resulted in both an increase in the total in-place gas and liquids estimates and a significant movement of previously accounted for contingent resources into commercial reserves pending development.

Based on the information provided by Beach, Drillsearch's own internal assessments and the progress made by the joint venture on development of these discoveries in PEL 106B, Drillsearch endorses the 2P reserve assessment for the Western Cooper Gas & Liquids Project Discoveries and the determination that these fields are commercial reserves pending development.

Drillsearch and Beach hold a common view on how the Western Cooper Gas & Liquids Discoveries should be developed and are in agreement that development along these lines is a commercially attractive project. The Joint Venture is currently developing detailed field development plans to support the development of these discoveries based on the very encouraging testing programme.

Managing Director Brad Lingo stated "This is a great result for the company and our shareholders. This is a clear and strong step towards putting these discoveries into production. With both Beach and ourselves taking the view that sufficient gas and liquids having been proved up to consider the discoveries commercial this is the first step to putting these fields into development. The very high liquids content of the fields, especially the Canunda discovery which holds nearly 1.26 MMBOE of condensate and LPG alone, really make these fields very attractive to develop."

For the complete Drillsearch announcement including Western Cooper Gas & Liquids Project Map, please refer to the following link:

http://www.abnnewswire.net/media/en/docs/63652-ASX-DLS-604860.pdf

Contact

Brad Lingo Managing Director Tel: +61-2-9241-4440 Email: admin@drillsearch.com.au http://www.drillsearch.com.au