Beach Energy Limited (ASX:BPT) Monthly Drilling Report Ending 6 October 2010

Perth, Oct 6, 2010 AEST (ABN Newswire) - Beach Energy Limited (ASX:BPT) (PINK:BEPTF) is pleased to release monthly drilling report ending 6 October 2010.

AUSTRALIA

Beach Operated Cooper-Eromanga Basin Gas - PEL 106FI Block

Testing operations at Canunda-1 are expected to recommence next week following fishing operations to remove wireline from the hole. The evaluation is intended to define size and production characteristics of this high liquids gas field (Beach 50%).

Cooper Basin Gas Development - Santos (ASX:STO) Operated
Operations in the Coonatie Gas Field have resumed with Coonatie-18 (Beach 17.14%) which is currently drilling surface hole. The Strzelecki Northeast-1 (Beach 20.2%) gas development well is expected to spud later this week as is the Irtalie East-1 Jurassic oil exploration well (Beach 38.5%) in the Queensland portion of the Basin.

Beach Operated Cooper Basin Shale

Gas Exploration - PEL 218

Drilling operations for Encounter-1 (Beach 90%), the first of a two well, back-to-back exploration program targeting shale gas potential in the South Australian portion of the Nappamerri Trough, commenced on October 3. Across the Nappamerri Trough the objective Roseneath, Epsilon and Murteree formations have the potential to contain gas in place in excess of 200 TCF. The shales of the Nappamerri Trough are considered to share many of the attributes of the prolific shale gas producing provinces of the USA.

Encounter-1 is estimated to take around 50 days to drill and will be immediately followed by Holdfast-1.

Extensive coring and logging programs are planned with the aim of better defining volumes of gas in place and assessing the physical and mechanical properties of the rock to plan for stimulation in early 2011. Fracture stimulation is one of the keys to unlocking gas from shales. The outcome of these wells will aid the future planning of a pilot production well expected to be drilled in 2011.

Beach Operated Geothermal - Paralana Project, Arrowie Basin

A wireline crew has been mobilised to Paralana-2 (Beach 21%) to investigate the blockage that prevented perforation of the target interval in late August. A short 3-day investigation is being undertaken to determine the nature of the obstruction at 3200m and clarify the forward plan for remedial action.

INTERNATIONAL

Unconventional

Non-operated Shale Oil Appraisal, South

Antelope Prospect, Williston Basin - North Dakota, USA

The Henderson 4-26/35H shale oil appraisal well (Beach 14.7% net revenue interest) spudded on 3 September. The well is currently drilling ahead in the lateral section and is expected to reach total depth in about a week. The well, targeting 600,000 barrels of recoverable oil (90,000 net to Beach), has been designed with a 2.7km long horizontal section through the Three Forks Formation reservoir, and will be stimulated with a 24 stage fracture stimulation treatment.

Drilling Report - Period ending 6 October 2010

( * )    Operator(s)      Secondary TargetsBPT      Beach Energy LimitedSTO      Santos LimitedSEA      Sundance Energy Australia Limited (ASX:SEA)Helis    Helis Oil & Gas Company L.LCORG      Origin Energy Resources LimitedADE      Adelaide Energy Limited (ASX:ADE) (PINK:ADEZF) 1.--------------------------------Well               Participants--------------------------------Encounter-1        BPT*   90.00%PEL 218            ADE    10.00%Gas Exploration             C/E Basin, SA-------------------------------------------------------------------------------------Weekly Progress & Summary             Primary Targets-----------------------------------------------------Report Time: 0600 (CST) 06/10/2010    PatchawarraDepth:       952m                           Operation:   Drilling surface hole.                  Progress:    952m-----------------------------------------------------2.-----------------------------------Well                Participants-----------------------------------Coonatie-18         BPT     17.14%PPL131              STO*    72.32%Gas Development     ORG     10.54%C/E Basin, SA-------------------------------------------------------------------------------------------------Weekly Progress & Summary                Primary Targets--------------------------------------------------------------Report Time: 0600 hrs (CST) 06/10/2010   multi Permian targetsDepth:       793m                       Operation:   Drilling ahead in 9 7/8"              surface hole.Progress:    793m--------------------------------------------------------------3.--------------------------------Well              Participants--------------------------------Coonatie-20       BPT    17.14%PPL131            STO*   72.32%Gas Development   ORG    10.54%C/E Basin, SA-----------------------------------------------------------------------------------------------Weekly Progress & Summary                 Primary Targets---------------------------------------------------------------Report Time: 0600 hrs (CST) 06/10/2010    multi Permian targetsDepth:       3239m (TD)                       Operation:   Well is cased and suspended              as a future Permian gas producer.Progress:    460m---------------------------------------------------------------4.-------------------------------------Well                     Participants-------------------------------------Sect. 25&36 McKenzie     BPT                   County, Nth Dakota       SEA                     Oil Appraisal            Helis*     Williston Basin          7 others -----------------------------------------------------------------------------------------------Weekly Progress & Summary                  Primary Targets----------------------------------------------------------Report Time: 0600 hrs (local) 05/10/2010   Three Forks FmDepth:       4978m                Operation:   Drilling ahead in lateral              sidetrack.     Progress:    4978m----------------------------------------------------------

For the complete Beach Energy drilling report including Well Location Map, please view the following link:

http://www.abnnewswire.net/media/en/docs/63895-ASX-BPT-179829.pdf

Contact

Steve Masters / Nicola Frazer Beach Energy Limited Tel: +61-8-8338-2833 http://www.beachenergy.com.au