The ACP8 permit is located 580km northwest of Darwin within the proven hydrocarbon province of the Laminaria High trend. Exploration drilling on this trend has successfully resulted in the discovery of a number of oil fields, (Laminaria, Corallina, Buffalo, Kuda Tasi, Jahal, Kitan) all close to ACP8.

 

 

Karoon is operator of the permits with 66.7% equity. Talisman Energy has the remaining 33.3% equity.

 

 

The main prospect is ‘Jania’ with up to 20mmbl potential prospective resource. There are 5 additional leads with similar size potential. Prospective resource sizes are above the economic threshold for this offshore setting, assuming the ability to tie back to the Laminaria facility.

 

The Year-1 work program started on 3 October 2008. Geological and geophysical studies are now underway to identify targets for drilling. A marine controlled-source electromagnetic (CSEM) survey will be undertaken during 2010 to assist in grading the prospects. The work is on target to be able to take up an option to drill in 2012.

 

The two main fields, Laminaria (initial reserves 103 MMBl) and Corallina (initial reserves 97.5 MMbl) are immediately adjacent to the south and east of Karoon’s acreage and were discovered in the 1990s by a Woodside Joint Venture. Both fields lie in 300-400m water depth. They came online in November 1999 and are still producing at around 11,000 bopd. At the time the “Northern Endeavour” was the largest floating production facility (FPSO) in the world. The joint venture is continuing to expand production of the field. Corallina-4 was drilled in August 2008 to investigate the eastern side of the structure and indicated that there was unswept attic oil in the Corallina field. As a result Corallina-2 Sidetrack-2 well was drilled in 2009 to add to production.

 

Recent (January –March 2008) drilling to the east at the ENI/Inpex/Talisman JPDA 06-105 block has led to the discovery of the Kitan oil field. The first well flowed 6100 bopd in initial drillstem tests at a depth of 3658 m (Eni, 2008). This Joint Venture has plans for early commercialization of this field and hopes to bring it online in 2011 now that they have received development approval. The field is estimated to contain 30-40 Mmbo (Reuters, July 2008).

 

The main discoveries on the Laminaria High have been within Late Jurassic reservoirs in tilted fault block and horst structures. The primary reservoirs that are the producing intervals in the Laminaria and Corallina fields are the high-permeability Callovian aged Laminaria Fm. and or Middle Jurassic Plover Fm. sandstones. The two fields both encountered 60° API light oil columns. The Karoon prospects are similar play types within the same trend.

 

 

The seals for the traps are interpreted to be the marine mudstones of the Oxfordian Frigate / Flamingo and Echuca Shoals Fm’s which comprise around 500m of variable quality seals.

 

February 2010