Current Feed Content from 2 Sep 08 15:32
Central Petroleum Limited (ASX:CTP) Coal Bed Methane Drilling Report 020908
Tue, 2 Sep 2008 15:39:20 +0900Central Petroleum Limited (ASX:CTP)(PINK:CPTLF) announce that at 0600 this morning the well had been drilled to 705m with preliminary wellsite interpretation putting the top of the Permian Purni target formation for Coal Bed Methane (CBM) evaluation at 696m.Preparations were being made to drill set an intermediate string of 7" casing at 705m.
The well of approximately 1, 200m Total Depth (TD) is expected to test a thick sequence of Permian coals updip from the Blamore 1 well recently plugged and abandoned due to engineering problems associated with hole sloughing about the Triassic Walkandi Formation and then failure of drill stem test tools to function. It is planned to conduct Drill Stem Tests for permeability measurements over any promising coal beds as well as to core the coals with a wireline retrievable coring system for CBM production analysis. Contingent plans have been made to complete the well as a potential producer.
CBM93001 is the second well in a planned 2008 seven well programme by Central Petroleum Limited (Central) and its Joint Venture Partners, Petroleum Exploration Australia Limited and He Nuclear Limited in 2008 targeting prospective Undiscovered Oil/Gas Initially in Place (UOIIP/UGIIP) at "high" estimate of 260 Mmbbls oil and 4.6 TCFG gas and up to 180 BCFG Helium in conventional reservoirs as well as representing the first phase of exploration for 34-70 TCFG in prospective recoverable Coal Bed Methane resources. Please refer to earlier announcements for details of the 2008 exploration programme.newsroom@abnnewswire.net (Asia Business News)AUDIO: Crossland Uranium Mines Limited (ASX:CUX) Initial Results From Charlie Creek
Tue, 2 Sep 2008 15:34:28 +0900Crossland Uranium Mines Limited (ASX:CUX) provides the opportunity to listen to an audio broadcast with Mr Geoff Eupene, CEO and Exploration Manager in a presentation titled "CUX - Initial Results Charlie Creek Nt - Mr Geoff Eupene, CEO and Exploration Manager".
To listen, simply click on the link below:
http://abnnewswire.net/lnk/Y9O655B1
The presentation details are as follows:
- CUX - Initial Results Charlie Creek NT - Mr Geoff Eupene, CEO and Exploration Manager
- Presented by Mr Geoff Eupene, CEO and Exploration Manager
- Mon, 1 Sep 2008 12:00PM AESTnewsroom@abnnewswire.net (Asia Business News)Australia Market Report of September 2: Downward Rate Move Expected to Continue
Tue, 2 Sep 2008 12:04:30 +0900Yesterday, the Australian share market closed slightly lower following weaker commodity prices. The benchmark S&P/ASX200 index was down 17.3 points, or 0.34%, to 5118.3, while the broader All Ordinaries index fell 15.5 points, or 0.3%, to 5200.
Weaker commodity prices had resource sector lose yesterday, and a falling oil price in electronic trading in New York overnight may continue to have a constraining effect on energy stocks. With physical markets on Wall Street closed for Labor Day, there is otherwise no lead from the US.
At 6.56am on the Sydney Futures Exchange, the September share price index futures contract was down five points at 5135, which is still higher than yesterday's close.
The Australian dollar has opened lower as the reduced threat of Hurricane Gustav to US oil supplies boosted the American currency. The Australian dollar fell below US85 cents for the second time in as many months after oil and base metals prices declined. At 0700 AEST, the Australian dollar was trading at $US0.8501/08, down from yesterday's close of 0.8537/42.
Oil prices have dived to a four-month low, sliding below $US110 in London as a weakening Hurricane Gustav reduced the threat of damage to energy facilities in the Gulf of Mexico, analysts have said. New York's main contract, light sweet crude for delivery in October, slid $US4.07 to $US111.39 after touching as low as $US110.63.
Key Economic Facts and Figures
The economy is not out of the woods despite a widely-anticipated interest rate cut today, Treasurer Wayne Swan says. The Reserve Bank is tipped to cut its official cash rate by at least 0.25 of a percentage point, if not more, in the first downward move since December 2001. Analysts still expect the rate cut to go ahead, but are doubtful about there being a series of cuts continuing into next year.
Company gross operating profits, seasonally adjusted, rose 21.5 per cent for the year to June, the Australian Bureau of Statistics (ABS) said yesterday. It was the biggest percentage rise since December 2001. Australian businesses posted their largest increase in annual profit growth for almost seven years with the mining boom.
Today, the Reserve Bank of Australia holds its monthly board meeting and is scheduled to announce its decision on the benchmark interest rate at 2.30pm. The Australian Bureau of Statistics releases building approvals data for July and the government finance statistics for the June quarter.
M&A News
Chinalco chairman Xiao Yaqing says it is "possible" that the Chinese aluminium giant will lift its strategic stake in BHP Billiton's (ASX:BHP) A$160 billion takeover target Rio Tinto((ASX:RIO). But Mr Xiao said Chinalco had not yet decided whether it would lift its shareholding in Rio.
Futuris Corp (ASX:FCL) has agreed to sell its 50 percent stake in Perth-based telecommunications provider Amcom(ASX:AMM). The sale comes on the back of the federal government's decision to cancel funding for the joint venture between Futuris and Optus for an OPEL rural and regional broadband network. The Futuris stake in Amcom was reduced to 18.6 percent. The transaction comprises a selldown by Futuris of 170 million shares to institutional investors and a buyback and cancellation by Amcom of the remaining 99.2 million shares beneficially held by Futuris for an average price of 18 cents each.
Child care operator ABC Learning Centres Ltd. (ASX:ABS) Tuesday said it had completed the sale of its U.K. vouchers business to share registry group Computershare Ltd. (ASX:CPU).
Cape Lambert Iron Ore (ASX:CFE) has signed a conditional agreement to make a 30 per cent investment in Marampa Iron Ore, a subsidiary of African Minerals and owner of the Marampa iron ore project in Sierra Leone. The agreement is a cash/scrip deal valued at more than $US45 million.
Important Corporate News
St George Bank (ASX:SGB) has returned to one of its more traditional sources of funding - the once-cheap home loans investment market - to raise just over A$1 billion towards its estimated A$12 billion financing needs for the current year.
Australian diversified miner Straits Resources (ASX:SRL) yesterday said it was optimistic the demerger of its coal assets into a separate A$2.7 billion spin-off would be finalised by October. Straits executive director Martin Purvis said the decision to distribute its 50 percent stake in Straits Asia to current shareholders via a new Australian Stock Exchange listing arose from the need to create 'more critical mass' for it 'undersized and undercapitalised' metals assets.newsroom@abnnewswire.net (Asia Business News)Zamia Gold Mines Limited's (ASX:ZGM) Anthony Molybdenum Discovery Expands Mineralisation And Project Potential
Tue, 2 Sep 2008 11:58:54 +0900Zamia Gold Mines Limited's (ASX:ZGM) diamond drill program at its Anthony Molybdenum Project, north of Clermont, Queensland, has expanded the mineralisation and increased the project's potential.
Highlights:
- Five of seven diamond holes are complete; the sixth hole (A018) is almost complete.
- Hole A016 averaged 428 parts per million (ppm) molybdenum (Mo) from 0 to 300m (end of hole) and included 5 intersections exceeding 600ppm Mo (see table 1)
- Hole A018, an extension to the shallow 1994 CRA hole DBT22, (which included 3 metres assayed at 890ppm Mo) is in progress at about 300m and contains intense veining with visible molybdenum mineralisation throughout (see photos) - assays pending.
- Hole A018 extends the high grade western zone by more than 100m to the west of Hole A012 and remains open to the west.
- Detailed geological logging of diamond holes A014 to A017 by consultant Dr Greg Corbett indicates multiple mineralisation events - upgrading the potential for additional discoveries.
- The diamond drilling program has enhanced the potential for the project to reach the conceptual target of 100 million tonnes.
Diamond Drilling Program update
ZGM's diamond drilling program has included four new holes to at least 300m (vertical depth 260m), a 93m diamond extension to reverse circulation (RC) percussion hole A009 and an extension to 1994 CRA RC percussion hole DBT22 (now hole A018) currently at approximately 300m with a target depth of 350m. The final hole will be an extension to high grade vertical RC percussion hole A012 and is expected to be completed in the next two weeks. (Drill hole locations of the holes are shown on Figure1 and collar co-ordinates are listed in Table 2)
Analytical results of the first two holes (A014 and A015) and partial results of the third hole (A016) to 210m were released to the ASX on 28 July 2008. The remaining results from hole A016 have been received together with partial results for hole A017 (the first 230m of 369m). Significant results are detailed in Table 1.
Hole A018 (a diamond drill extension of CRA hole DBT 22), located 150m west of high grade hole A012 (75m at 1103ppm Mo) is currently being drilled and is intensely mineralised throughout with molybdenum rich veins. Results from A018 are eagerly awaited and are expected to expand the high grade zone found in holes A008, A011, A012 and A013.
The mineralisation observed in hole A018 is significant as CRA reported 63m at 219ppm Mo from 66m to 129m (the end of hole DBT22) and the observed mineralisation tends to confirm ZGM's belief that the analytical technique used by CRA may have understated the molybdenum grade. The CRA hole included a reported assay of 890ppm Mo from 108 - 111m.
In addition to expanding the zone of known mineralisation, the diamond drill program has improved the geological understanding of the Anthony deposit and its geological setting. Logging of the drill core from holes (A014 to A017) by ZGM geologists and renowned consultant Dr Greg Corbett has recognised several generations and styles of porphyry molybdenum mineralisation that may be associated with multiple porphyry intrusions.
These observations are significant as they indicate that the Anthony area may contain mineralised bodies not yet encountered in the current drill program. Such bodies may be molybdenum porphyries and/or copper-molybdenum-gold porphyries. The future program will include both the planned systematic RC percussion drill out of the Anthony deposit and geophysical surveys to identify additional targets surrounding Anthony. The molybdenum price is currently around US$33/lb ($A70, 000/tonne) and average grades of new molybdenum mines are around 600 - 700ppm with cut-off grades from 200 - 300ppm Mo. On this basis Anthony has the potential to be a major project and the next round of drilling will aim to identify an inferred resource approximating to the conceptual target of 100m tonnes.
------------------------------------------------- Hole No. Depth From To Width Mo Comment (m) (m) (m) (m) (ppm) ------------------------------------------------- DD08A016 300 0 300 300 428 Complete hole 0 100 100 429 Oxide* 100 300 200 428 Sulphide including 120 128 8 657* including 150 164 14 625* including 176 184 8 673* including 234 248 14 681 including 296 300 4 601 ------------------------------------------------- DD08A017 369.4 0 84 84 348 Oxide 146 170 24 463 Sulphide including 160 170 10 599 230 369.4 Awaiting results ------------------------------------------------- Table 1 Significant Molybdenum Results * released previously ------------------------------------------------- Hole No MGA East MGA North Azimuth Dip Depth ------------------------------------------------- DD08A009 528700 7532252 355 -60 264 DD08A012 528820 7532800 -90 pending DD08A014 529225 7532880 104 -59 303.6 DD08A015 529338 7532707 351 -61 300 DD08A016 528920 7532802 358 -60 300 DD08A017 528820 7532900 356 -60 369.4 DD08A018 528653 7532808 052 -60 In progress ------------------------------------------------- Table 2 Diamond drill holes - location, direction and depth Competent Person:
Mr R N (Sam) Lees (FAIG, FAusIMM), compiled the technical aspects of this report. Mr Lees is Executive Director - Technical, Zamia Gold Mines Limited. Mr Lees is a Fellow of the Australian Institute of Geoscientists and has sufficient experience that is relevant to the style of mineralisation and type of deposits under consideration and to the activity that is being reported on to qualify as a Competent Person as defined in the September 2004 edition of the "Australasian Code of Reporting of Mineral Resources and Ore Reserves". Mr Lees consents to the inclusion of the matters in the form and context in which it appears.newsroom@abnnewswire.net (Asia Business News)Zylotech Limited (ASX:ZYL) Partners With Microsoft Embedded Channel To Take On Apple's Market
Tue, 2 Sep 2008 11:43:14 +0900Zylotech Limited (ASX:ZYL) is proud to announce that Zylotech's Rainbow product, has received its strongest endorsement yet from 3P Studios, one of Australia's leading multi-media production houses. Underpinned by a partnership with Microsoft through their designated exclusive embedded channel distributor in the ANZ region, DSTA P/L, Rainbow is now a legitimate substitute to other high-performance media-centre PCs. This enables Zylotech to position itself to capture a significant share in the Graphics, Animation and Postproduction Studio market often considered to be a patch held by Apple.
3P Studios www.3Pstudios.com are providing the creative imagery, animation and production force for Australia's leading advertising agencies such as Mojo and Cummins on great campaigns for Telstra, Australia Post, Kmart, Kraft and Cadbury. Their endorsement is a significant feat for the Zylotech R&D team that has admittedly set its aims very high in entering this captive and established market space.
Mr. Marco Palmieri, Animation Director and Head Digital Artist at 3P Studios explains:
"As a production house for animation, graphics and photography, we really put our computers through their paces. We are really dazzled with how Rainbow handles our heavy-duty editing software; not forgetting, how exceedingly well it performs with CS3, Adobe's latest and most demanding suite for designers.
It's got all the gear we need for managing high-end multi-media jobs. On-board Hi-fi Audio, Dual HDTV Video and the latest connectivity standards support, makes it ideal for editing and managing digital video, audio and imagery".
Mr. Palmieri added: "This is the first Microsoft based computer that we really have to tip our hat to - it's small, packed with performance - and all at about half the cost we would otherwise need to spend on Macs. Its energy efficiency and good looks set it apart from all the others. As a studio work-horse, it's a real winner".
Rainbow comes in several models. The Home-theatre/Graphics and Animation model incorporates an internal 1 Terabyte drive capacity good for up to 200 DVD titles. It replaces a host of devices, gaming/media centre console PCs, Audio/MP3 Pre-amplifiers, DVD player/recorder and Video Editing suites. XP or Vista OS provide full compatibility with applications. On-Board fault-tolerant RAID storage provides a peace of mind and Dual-Screen with 5.1-Surround Sound are standard whilst HD Blu-Ray DiscTM is optional.
Measuring a mere 2.5" x 7.5" profile and featuring fanless CPU cooling, robust 3mm all-aluminum chassis and under-desk mounting, Zylotech's groundbreaking energyefficiency Rainbow runs at just 20% power consumption of the average equivalent high-performance media-centre PC, featuring critical 'performance over size' and 'performance over power-efficiency' factors set to revolutionise how media-centre and high-end graphics products are designed, built and powered over the next 5 years.
This technological breakthrough elevates Zylotech's capability to international standards. Zylotech can now capitalise on its investment in this technology and achieve its growth strategy by providing its partners with the opportunity to value-add and penetrate a market estimated well in excess of $750M in Australia alone. Our ultimate aim is to make Rainbow the 'product of choice' to major integrators like IBM, NEC and Microsoft.newsroom@abnnewswire.net (Asia Business News)Open Briefing(R). Otto Energy (ASX:OEL) Galoc & Exploration Forward Plan
Mon, 1 Sep 2008 15:29:56 +0900Otto Energy Limited (ASX:OEL)(PINK:OTTEF) recently released its Quarterly Report for the period ended 30 June 2008. What can you tell us about the corporate milestones met so far this year, and what investors can look forward to in the next 6-12 months?
CEO Alex Parks
We've had several highlights in what has been a busy quarter. The FPSO (Floating Production, Storage and Offloading vessel) is on site at the Galoc Oil Field (OEL indirect interest 18.28%) offshore Philippines and we were awarded additional offshore acreage in that country with SC69. We launched the farm-out process for our Philippines blocks SC50, 51 and 55, we completed a four well drilling campaign in Turkey with a 100% success rate, and now have sufficient gas volumes to commit to a development there. Furthermore we confirmed our farm-in to the block in the Po Valley, Italy, as well as being finally awarded our Argentina licence.
Over the next six to 12 months, investors can look forward to an active exploration and development drilling program across all of our assets. In our non-operated onshore licences, we have an active drilling program starting with the Gazzata-1 well in Italy in November and two wells on the huge Santa Rosa Dome prospect in Argentina in early 2009, as well as more exploration and development drilling in Turkey prior to gas production starting there in mid 2009.
As operator we are in advanced stages of the planning for two important wells in the Philippines in the first half of 2009 with drill site surveys in progress, and, of course, we expect to start generating cash flow from our first producing asset with oil production from the Galoc field.
corporatefile.com.au
What is the timetable to first production from Galoc Oil Field? What is the remaining commissioning schedule?
CEO Alex Parks
We are hoping to be on production in the coming weeks at Galoc. There were some issues which delayed the start up due to Typhoon Fengshen and usual teething problems with a new installation however we now believe that we are close to first oil.
It is difficult to fathom unless you have actually witnessed the operations in person, just how massive a feat of engineering these offshore installations are. Every effort is made to ensure the system is ready before flowing oil, as once the system is full of oil it is that much more difficult to make adjustments on the subsea equipment in particular.
The important thing for investors to understand is that the critical elements of the project are made up of: the reservoir, the wells, and the surface equipment. Nature controls the reservoirs, our well engineering has proved to have been successful and we know we can flow oil from it. So the final element is the subsea equipment and the processing equipment, i.e. the FPSO. Whilst we've had a short term problem due to delays and damage caused by bad weather, it is the one element of the project that can, and will, be rectified.
We have not yet finished commissioning the system and whilst we think we have addressed the teething problems now, it is a sequential process and there may be a few more adjustments required before we can flow oil, but overall assuming there are no more typhoons or other unforeseen problems, we should see production from the Galoc field commence in the coming weeks.
corporatefile.com.au
What flow rates do you expect from Galoc? When do you expect to be able to better assess the upside potential above the current 2P Reserves of 23.5 million barrels of oil (100% basis)?
CEO Alex Parks
Production will come on gradually, building up to an expected stable rate of between 15, 000 and 20, 000 barrels per day (100% basis). Once we have one or two months of production data, we will better understand the longer term potential of the field. However, the results of the development wells drilled earlier this year have given us a lot of encouragement. We discovered better quality reservoir sands with higher oil saturations. These better field properties, combined with the higher oil price, means that we will almost certainly move to a second phase of development, which would involve drilling potentially two additional development wells around 18 months from first oil, from a part of the Galoc field not drained by our current two production wells.
corporatefile.com.au
How much is the delay of first oil from Galoc costing Otto? What impact is it having on the Company's cash reserves?
CEO Alex Parks
Whilst the deferral of the revenue from Galoc is frustrating and prevents us taking on new projects, the current operations are not costing Otto much at all because it is the responsibility of the contractor, Rubicon, to repair the system. The JV will not start paying for the FPSO lease until the riser and FPSO are operational. Until then, the JV is only liable for the cost of the support operations.
Otto has no drilling activities scheduled until later in the year when we spud Gazzata-1 in Italy, and we don't foresee any other major expenditures occurring before then. As such, provided Galoc does come on-stream in the next couple of months, we can wait out the delays at Galoc with our cash reserves remaining quite adequate.
corporatefile.com.au
Once online, Galoc will be Otto's first producing asset. How will the new cash stream be used by the Company?
CEO Alex Parks
Subject to the oil price and the production rates, Otto expects to receive between $US50 and US$100 million over the next 12 to 18 months, after repayment of the GPC debt. This will all be invested back into our exploration program.
We have a number of wells coming up including in Italy, Argentina, the Philippines and the development project in Turkey. In total, that will amount to between 6 and 14 wells, depending on drilling successes, over the next 12- 18 months. In combination with our farm outs, we expect to be spending around US$30-$50 million (Otto share) on exploration drilling in the next two years.
The remaining cash flow will be used to fund the Edirne gas development project in Turkey as well as for additional appraisal and development drilling if we have success with the exploration wells. If the oil price remains over US$100per barrel, we may consider committing funds to other growth areas such as accelerated seismic programmes and new ventures.
Overall, we'll be in a very strong financial position once Galoc comes on stream.
corporatefile.com.au
Otto has launched a farm out program to secure joint venture partners for drilling programmes at your Philippines acreage in SC50, SC51 and SC55. How is the farm out process going? What sort of a response have you had from industry so far? When do you expect to have partners in place?
CEO Alex Parks
The major reason we're farming out this acreage is because we have very high equity positions with currently 85% to 80% working interest in each block. We launched the farm out process for all three blocks simultaneously because companies might be interested in participating in one, two or even all three of the blocks.
We've had a good response from the industry so far. There are over 40 confidentiality agreements in place and we have prepared the data for each asset so that each party can review them at the same time. Every company we've given the farm out presentation to has subsequently signed a confidentiality agreement expressing an interest in examining the data in further detail, which is very encouraging Overall, we are confident we will attract suitable farm-in partners for each block.
Currently we are meeting with interested parties and inviting them to view the data both online and in our offices. We've requested indicative offers be submitted by the middle of September, with negotiations following. We should be in a position to announce one or more farm outs during the last quarter 2008 or first quarter 2009, depending on the length of negotiations and finalising the paperwork.
corporatefile.com.au
What exploration activities do you plan for the Philippines acreage being farmed out? Can you explain the play concepts and prospectivity of each block (SC50: Calauit oil field; SC51: Argao prospect; SC55: Deep water block)?
CEO Alex Parks
SC50 is a block off north-west Palawan and it contains the Calauit and Calauit South oil discoveries, which were made in 1991 and 1992 respectively. The Calauit field contains somewhere between 12 and 75 million barrels of oil in place and we're aiming to drill an appraisal well during the first quarter of 2009 and conduct flow testing. Depending on the results, we will then commit to an extended production test and subsequently a full field development. We're looking for a farm-in partner to share the appraisal drilling costs. Otto acquired 3D seismic over the Calauit fields during 2007, which allowed us to identify what we believe are the sweet spots of the reservoir, so we're targeting a relatively low risk appraisal programme with a view to optimising the development.
SC51 is a pure exploration play in the Cebu/Bohol Strait between Cebu Island and Bohol Island offshore from a proven petroleum system and this licence contains the very attractive Argao prospect. Argao has eight "stacked" potential reservoir/seal pairs, so with one well we can target eight potential reservoirs. During 2007, we acquired 3D seismic to de-risk the block and an added attraction is that a small gas cap is clearly identified on the crest of the second shallowest structure with significant down dip potential for oil. The area is definitely oil prone, so an indication of the presence of gas is encouraging and it indicates that the reservoir seal has integrity. Overall, we consider SC51 a relatively low risk exploration play and we look forward to drilling it during the first half of 2009. There is also a follow up target to the north of Argao, called Bahay, which has similar characteristics to Argao, with three stacked reservoir levels. In total, Argao and Bahay have pre drill estimates of well over 100 million barrels of recoverable oil for the potential upside case.
SC55 is a deep water block where Otto has acquired 1, 400 km of 2D seismic to identify and mature several leads. We're looking for a partner to commit to drilling a deep water well, which we anticipate would be drilled in 2010. Before then, we want to acquire an extensive 3D seismic survey with a view to firming up some of the 15-plus leads we've already identified in the block, eight of which could quite comfortably contain over a 1 billion barrels of oil in terms of size.
The SC55 block is in an excellent geological location. There's plenty of oil to the south-west off the coast of Borneo and to the north-west with the Sampaguita/Reed Bank area, which is reported to host multi Tcf of wet gas. Also, there is the Malampaya field to the north, which is the largest field in the Philippines with 3.5 Tcf of gas and several hundred million barrels of oil in place. Our licence sits in the middle of this prolific oil and gas fairway with a proven and active petroleum system. We think that our block has significant oil and gas potential.
corporatefile.com.au
In May 2008, Otto announced it was awarded Service Contract 69 (Area 8) - what is the play concept and prospectivity of this block? What are your exploration plans for this block and is it part of the farm out programme currently underway?
CEO Alex Parks
The offshore block SC69 (OEL 70%) is relatively "frontier" acreage. There is approximately 4, 500 km of 2D seismic data covering the block, 3, 500 km of which is available as digital data. We're currently collating all of that data and we will use it in combination with our knowledge from the SC51 block to fasttrack exploration. There are over 20 identified structures that we want to investigate with further seismic. The block is huge; covering over 7, 000 sq km with potential for gas towards the north and west of the block. Cebu Island, the second most populated in the Philippines, lies to the west of the permit and there is a reasonable expectation that in the event of even a modest gas discovery, we would be able to readily commercialise it.
SC69, although adjacent to our SC51 block, is not part of the current farm out package because we want to add more value to the block before we move to the drilling phase. Work will continue there in conjunction with some of our exploration in SC51 and, although we have a relatively modest commitment of only one firm well, we'll look to accelerate exploration based on the geological potential of the block.
corporatefile.com.au
During the quarter, Otto and its joint venture partners completed drilling four wells at the Edirne Gas project in Turkey (OEL 35%). Can you explain the drilling and production test results? What is the potential scale and timeframe to bring it into production?
CEO Alex Parks
During the quarter we drilled four wells in the Edirne licence in the Thrace Basin on the European side of Turkey. Each well discovered gas in relatively shallow layers between 250 and 500 metres depth. We tested three of those wells and they flowed dry gas between 2-4 million standard cubic feet per day. These are very good rates for shallow gas and we now have six gas discoveries in the block ready for development. Our joint venture partner and Operator, Incremental Petroleum, will be developing the project over the next nine to 12 months with the aim of flowing first gas in the middle of 2009. We anticipate production of 6 to 10 million standard cubic feet per day (100% basis) and will tie in further discoveries to maintain that rate for several years. Edirne will provide Otto with a second cash flow stream of somewhere between US$5-10 million per year.
corporatefile.com.au
You have taken a 50% working interest in two onshore oil and gas permits at Bastiglia-Cento in the Po Valley in Italy. What is the history of hydrocarbon production in the region? Why was this a strategic opportunity for OEL?
CEO Alex Parks
These adjacent permits in Italy strengthen Otto's European gas business. The Po Valley has produced over 13 Tcf of gas in its history when it was predominately held by ENI. The acreage was "turned over" during the late 1990s and early 2000s and various companies picked up acreage. Our partners, Ascent Resources, acquired 100% of the two blocks in late 2005 and Otto is farming in for 50% by paying 100% of the first well.
This is an important onshore acquisition for Otto because a truly balanced oil and gas asset portfolio has a combination of oil and gas, onshore and offshore. This gas project is relatively low risk and relatively low cost as discoveries should be easy to commercialise because of its onshore location close to major European markets. In the event of success, it would provide Otto with stable income. The Gazatta-1 well has the potential to be worth over $200 million net to Otto, which equates to around 30 cents a share.
corporatefile.com.au
What are Otto's farm in commitments and exploration plans for these leases in Italy? When will you start drilling there? What is the potential upside to OEL in the case of exploration success?
CEO Alex Parks
Our farm in commitment was to pay for the purchase of some existing seismic data, which we've completed and to drill one well at 100% of the cost to Otto (with a cap). The operator will chip in for anything over and above the anticipated EURO4 million on the well cost. In the event that we have a significant discovery with proven gas reserves of 10 Bcf, we are also obliged to pay 100% of the second well (with a similar cap).
We expect to commence drilling in November and it will take about eight weeks to drill and test. The potential target is somewhere between 40 and 300 Bcf of recoverable gas and our most likely case is about 130 Bcf of gas. In the event of such a discovery, we estimate that it would equate to around 30 cents per share with significant upside potential from "adjacent "lookalike" prospects in the block.
The block has a huge amount of follow up potential. We think there could be as much as 2 Tcf of recoverable gas in the Bastiglia-Cento permits and that represents material production for Otto. We expect to explore and develop the permits quickly and efficiently. There is a very good pipeline infrastructure, a guaranteed gas market, high gas prices and an attractive fiscal regime.
corporatefile.com.au
In May 2008, OEL announced the awarding of the Santa Rosa licence in Argentina. What is OEL's working interest in this project? When do you expect to start exploration activities there? What is the potential upside to OEL in the case of success?
CEO Alex Parks
Otto initially is earning a 32.48% interest in the licence by spending US$1.4 million with an option to increase our equity up to 41.24% by spending a further US$900, 000. We were awarded the block in May and work is already underway. We're currently gathering all of the existing data that we didn't have access to previously and awarded an environmental survey in preparation for drilling. We've already identified two firm locations with one contingent appraisal location to drill the Santa Rosa Dome during the first half 2009. The Dome itself is huge. It's almost circular with a diameter of about 20 km. We expect up to 150 metres of reservoir closure sub-surface. It's a relatively shallow structure of just over 1, 000 metres of drilling, so we expect drilling will be inexpensive and generally fairly simple. Although the fiscal regime in Argentina is not particularly attractive, the project is in a low cost working environment with good oil infrastructure.
The Dome could contain huge amounts of oil even if it contains a fraction of the potential upside of over 200 million barrels of oil recoverable. Our calculations indicate the mid case scenario potentially represents 60 cents per share in terms of potential value in the event we make a discovery. Success in Argentina would be very profitable for Otto.
corporatefile.com.au
OEL recently raised $15.0 million in a share placement. What was this money for? What is your cash balance at present? Do you foresee having to do another capital raising this year?
CEO Alex Parks
We raised the money to make sure we could maintain our momentum regardless of exactly when Galoc started to produce oil. The funds are used to cover site surveys for drilling in the Philippines in particular over Argao and the Calauit well locations. We raised enough funds to cover the purchase of long-lead items for drilling in Italy and the Philippines and to cover overheads until the Galoc field starts to flow. Our cash balance is just over $10 million and that will see us through the next few months. Provided Galoc flows within the next two to three months we don't expect another capital raising this year.
corporatefile.com.au
OEL's major corporate objective is to grow to a $billion market capitalisation company and to be internationally recognised as a partner of choice. What can you tell us about the current Otto team at hand who are driving the Company's mission forward?
CEO Alex Parks
I am really excited about the calibre of people we have assembled who are driving this company forward. Our Chairman is Rick Crabb, a solicitor who specialises in mining, corporate and commercial law and has acted for a number of major foreign companies operating in Australia, as well as Australian companies with offshore projects - he is also Chairman of Paladin Energy. Otto's founder is Dr Jaap Poll, who has over 40 years experience in the international petroleum industry. Furthermore, non executive directors Rufino Boomasang, John Jetter and Ian Macliver all have extensive experience in managing large organisations in Australia and overseas.
My background is that I have been practicing as a Petroleum Engineer for more than 12 years in the UK and Australia. I hold a Masters of Petroleum Engineering degree from London's Imperial College and have held senior management positions for the last 7 years in Perth, including as Managing Director of Troy-Ikoda Australasia and Technical Director of Geoscience and Engineering for RPS Energy (Australia / SE Asia) prior to joining Otto as CEO in 2006.
We've also significantly added to our management team, all of whom have extensive experience with oil and gas majors. Craig Martin, Chief Operating Officer, joined eighteen months ago with extensive offshore experience in a diversity of roles. Richard King, Commercial Manager, recently joined us from Chevron and will oversee negotiation and finalise the farm in agreements on our major exploration blocks in the Philippines.
Jane Secker recently joined as the Calauit project manager, and she has nearly twenty years experience in the oil and gas industry. John Sheppard is our nonoperated assets manager and he also has extensive experience in resources banking and asset management. Stefan Kleffmann joined in May to lead our growing Geoscience and engineering team. We also have a number of IPS drilling consultants in house who are working on the drilling program for the Calauit and Argao wells. In Manila we have a team of twelve including experienced geoscientists to manage our activities on the ground in the Philippines.
From the Board through to our management and technical teams, we have put together a fantastic group of people who bring exceptional oil and gas experience and big business knowledge to the Company.
corporatefile.com.au
In the next two years, OEL will participate in four potential 'company making' wells that could make OEL a significant mid-cap company. Can you describe the mid-term, and longer term, growth strategy and opportunities for Otto?
CEO Alex Parks
Whilst Otto is primarily an exploration company, it's also important to show that our development projects - Galoc, the Turkey gas discoveries and the appraisal and development of the Calauit oil fields - can be executed and developed on time and within budget as these will be the foundations that fund our exploration ambitions.
The cash generated from these developments will be used to fund a significant exploration program. The four wells coming up, including Gazatta-1 in Italy, the Santa Rosa wells in Argentina, Argao and one of the deep water wells in the Philippines, could each comfortably double the current market capitalisation of the Company and would then go on to fund the next stage of growth.
In the mid-term, we'll continue to add new exploration opportunities on two fronts. Firstly, we will further mature our current exploration areas such as SC50, SC51, SC55, SC69, Italy and Argentina and then gradually add new acreage, predominantly through operated assets in South East Asia and in nonoperated assets anywhere in the world.
We have good growth momentum, are opportunity rich and well funded - we believe Otto has all the right ingredients to become a substantial oil and gas company and provide significant returns to our shareholders.newsroom@abnnewswire.net (Asia Business News)Grove Launches Term Deposit Shop
Mon, 1 Sep 2008 14:15:12 +0900One of Australia 's leading asset consultants, Grove Research and Advisory, has launched an online term deposit shop to help wholesale investors compare rates and invest with a number of Australia 's leading financial institutions.
The news comes shortly after the advisory team from Standard and Poor's joined Grove. According to Grove's Managing Director, Simon Ibbetson : "Term deposits have become an important part of investors' liquidity management requirements following the global turmoil in the credit markets."
Initially, the Term Deposit Shop will provide wholesale investors with comparable daily rates from Citibank, BankWest, Investec and Rabobank. In what is believed to be a first for Australian financial markets, "the Term Deposit Shop will deliver a competitive range of wholesale rates from a variety of issuers across a range of maturities through the efficiency of an online investment platform, " said Mr Ibbetson.
According to Kuin Lee from Investec: "The platform allows clients to instantly access highly-competitive investment rates, and to compare rates without having to ring around for comparisons."
This is a view supported by Rabobank's Finance Manager Deposits, Mr Carlos Vieco, who believes: "The online environment is simple, transparent and easy to use and allows customers access to market competitive rates at the click of a mouse."
"Over the past 6-12 months we have seen a change in what customers expect from their investments. They have become much more informed about the risk associated with deposit products and they now take a balanced approach when deciding to invest between 'risk' and 'reward'. There is a definite increased focus on the stability and reputation of the institution they are looking to invest with, " said Mr Vieco.
According to Ms Lee: "It is also comforting for investors to know that Grove have paved the way by performing their own due diligence on the banks included on the platform."
"The Grove platform gives Investec exposure to a wider client base, some of whom may not know much about us. And of course, those that do know us now have a platform to instantly compare our rates and see how competitive we really are, " added Ms Lee.
According to Mr Ibbetson: "There is strong demand from a range of industries for term deposits, which is being driven by the flight back to the banks and the higher cash rate. Grove has long and well established relationships with local governments, universities, health funds, charities and aged care facilities and with the high cash rate it is a good time to invest in term deposits."
"There has never been an online portal like this, providing the customer with a marketplace to access competitive rates and invest. By providing investors direct access to the issuer through a convenient online buying and reporting facility we hope to create a competitive environment for the issuers."
The Term Deposit Shop is delivered through Grove Portfolio Online (GPO). For further information please contact Grove on:
TEL: +61-2-8246-8800 or visit http://www.termdepositshop.com
For media inquiries please contact:
Tom Godfrey on:
TEL: +61-449-681-282 or tom@bellgeorge.com
Ends
The Grove Term Deposit Shop helps wholesale investors compare rates and invest online. All issuers listed on the www.termdepositshop.com are APRA-regulated Authorised Deposit-taking Institutions (ADI's). Grove Portfolio Online (GPO) has serviced wholesale clients since 2001, for further information visit www.groveonline.com.au.
Grove is owned by a number of private investors and Western Financial Services. It has been in operation since 1991 and has well over 100 clients. Many clients have been with the business in excess of a decade. Grove provides active portfolio advice and reporting on about $5 billion of client investment. Clients include Superannuation Funds, Dealer Groups, Fund Managers, Councils, Universities, Health Funds, Corporations and High Net Worth individuals.newsroom@abnnewswire.net (Asia Business News)Australia Market Report of September 1: June Quarter GDP Expected to Slow
Mon, 1 Sep 2008 12:01:32 +0900The Australian stock market has received negative leads from Wall Street on Friday. Oil rose again in anticipation of Hurrican Gustav making landfall in the continental US.
On Friday, the Australian share market closed substantially stronger, driven by gains in the financial sector. The benchmark S&P/ASX200 index was up 69.1 points, or 1.36%, to 5135.6, while the broader All Ordinaries Index advanced 72.2 points, or 1.4%, to 5215.5.
At 6.50am on the Sydney Futures Exchange, the September share price index futures contract was down 29 points at 5115.
The Australian dollar has opened lower as improved factory health boosted the American currency. Business activity in the US midwest grew in August. At 0700 AEST, the Australian dollar was trading at $US0.8566/73, down from Friday's close of 0.8609/11.
Oil futures jumped at the open of electronic trading today, as the energy industry braced for the onslaught of Hurricane Gustav. Light, sweet crude futures for October delivery were up $US2.13, or 1.8 per cent, at $US117.59 a barrel, off a session high of $US118.39.
Key Economic Facts and Figures
Reserve Bank governor Glenn Stevens is expected to accompany tomorrow's interest rate cut with a statement stressing the continuing threat of inflation. The central bank remains cautious about how the surge in income from iron ore and coal will flow through the economy.
UBS chief economist Scott Haslem says it remains possible that Australia will join the list of developed countries reporting that their economies contracted in the June quarter.
Gross domestic product is forecast to increase by 0.4 per cent in the June quarter for an annual pace of 2.9 per cent, according to the median of 10 economist forecasts. That would be slower than the 0.6 per cent growth record in the March quarter, and the annual rate of 3.6 per cent. If realised, the annual growth forecast for the June quarter would be the slowest growth since the December quarter of 2006, when it was 2.8 per cent.
Today, the Australian Bureau of Statistics is to release data on the balance of payments, foreign investment and business indicators for the June quarter. The Reserve Bank of Australia releases its commodity price index for August.
TD Securities and the Melbourne Institute release their inflation gauge, and the Australian Industry Group and PricewaterhouseCoopers issue their Australian Performance of Manufacturing Index, also both for August.
M&A News
Commonwealth Bank of Australia Ltd. (ASX:CBA) said it will take a strategic 33% stake in privately owned mortgage broker Aussie Home Loans, increasing its exposure to the home-loan market. Without disclosing the amount paid for the stake, CBA said Aussie Home Loans will remain an independently managed operation under the control of its founder and chairman, John Symond.
Santos (ASX:STO) is accessing the upcoming sale of electricity and gas retailer EnergyAustralia by the NSW government. In the past, it has looked to buy TXU Australia (now TRUenergy, owned by CLP holdings) and at merger prospects with AGL Energy (ASX:AGK) in order to move from exploration and production into retailing of energy to business and personal customers. Santos has strong cash reserves after collecting US$2 billion for a 40 percent stake in its Gladstone LNG project from Malaysian company Petronas.
Important Corporate News
ABC Learning Centres (ASX:ABS) chief executive Eddy Groves says a higher-than-expected loss for fiscal 2008 is due to a 'difference of opinion' between its old auditors, Pitcher Partners, and current auditors Ernst & Young. The childcare operator flagged a pre-tax loss of A$437 million four weeks ago, but is expected to post a worse result after being compelled to restate its accounts.
Queensland Gas Company (ASX:QGC) said a new A$7 billion liquefied natural gas project could eventually put the group on par with Woodside Petroleum (ASX:WPL). The company also said a joint development with BG Group (LSE:BG) in Gladstone, 550 km north of Brisbane, would give it roughly about the same amount of petajoules as Woodside is exporting when the project came online in six years.
Property investor and fund manager City Pacific (ASX:CIY) today reported a A$139.53 million bottom line loss for the last financial year, after it was forced to make writedowns on some its assets and investments. City Pacific said ructions in the property market due to the global credit crisis had impacted its business, resulting in the revaluations.newsroom@abnnewswire.net (Asia Business News)ABN Amro Equity Research Report Released for Mesoblast Limited (ASX:MSB)
Mon, 1 Sep 2008 11:17:44 +0900Mesoblast Limited's (ASX:MSB)(OTC:MBLTY) product has statistically significant higher fusion rates in anterior cervical interbody operations compared to a competitor. We believe the competitor's FY08 cervical fusion sales were cA$325m, but has recently been forced to exit the market.
Mesoblast (MSB.AX): FY08: spinal shock
Long term (12 months): Buy
Target price: A$1.50 (from A$1.30)
Reason: Change of target price
FY08 result - higher-than-expected interest income
MSB posted an NPAT of -A$10.1m for FY08, with a loss below our forecast of -A$10.4m due to higher-than-expected interest income. We believe MSB has sufficient cash (A$14.1m in FY08) to fund its clinical programme for the next one to two years.
A new cervical spine opportunity
Major recent news relates to a new indication for MSB's osteoinductive adult mesenchymal precursor cells (MPCs). MSB recently issued data showing that MSB's MPCs achieved a statistically significant improvement in cervical fusion rates compared to Medtronic's osteoconductive bulking agent (MasterGraft Granules). Given the recent issues with Medtronic's osteoinductive Recombinant Human Bone Morphogenic protein (rhBMP) product (also used in cervical fusion operations) we believe a significant opportunity exists with MSB's MPCs being potentially useful over the medium term in anterior cervical interbody fusion operations.
MSB's MPCs may address the gap in the market for cervical fusion
In July 2008, the US FDA issued a statement that the safety and effectiveness of rhBMP in the cervical spine had not been demonstrated and these products were not approved by FDA for this use. We believe the anterior interbody cervical spine fusion market for BMPs is worth cUS$325m. As a result of the FDA decision, we believe there is currently no synthetic bone graft approved for anterior interbody cervical spine fusions. Medium-term, MSB's MPCs may address this gap in the market.
Buy rating maintained, target price A$1.50
The major changes to our forecasts have been: 1) we believe MSB will get its product to market in FY11 (previously 2HFY10) - hence we believe MSB will not be cash flow positive until FY11; and 2) given the anterior cervical interbody fusion opportunity, we believe initial sales of MSB's cells will be greater, and have updated our forecasts accordingly. As a result of changes to forecasts, our DCF valuation and 12-month target price have increased by 15.4% to A$1.50 per share.
To view the full report, please visit:
http://mesoblast.com.au/investor_analysis.phpnewsroom@abnnewswire.net (Asia Business News)Central Petroleum Limited (ASX:CTP) Announce Drilling Report For Winton Formation
Mon, 1 Sep 2008 11:10:06 +0900Central Petroleum Limited's (ASX:CTP)(PINK:CPTLF) Announce drilling report 010908 CBM93001. At 0600 this morning the well had been drilled to 280m in the Winton Formation and preparations were being made to drill ahead after setting 9 5/8" casing.
The well of approximately 1, 200m Total Depth (TD) is expected to test a thick sequence of Permian coals updip from the Blamore 1 well recently plugged and abandoned due to engineering problems associated with hole sloughing about the Triassic Walkandi Formation and then failure of drill stem test tools to function. It is planned to conduct Drill Stem Tests for permeability measurements over any promising coal beds as well as to core the coals with a wireline retrievable coring system for CBM production analysis. Contingent plans have been made to complete the well as a potential producer.
CBM93001 is the second well in a planned 2008 seven well programme by Central Petroleum Limited (Central) and its Joint Venture Partners, Petroleum Exploration Australia Limited and He Nuclear Limited in 2008 targeting prospective Undiscovered Oil/Gas Initially in Place (UOIIP/UGIIP) at "high" estimate of 260 Mmbbls oil and 4.6 TCFG gas and up to 180 BCFG Helium in conventional reservoirs as well as representing the first phase of exploration for 34-70 TCFG in prospective recoverable Coal Bed Methane resources. Please refer to earlier announcements for details of the 2008 exploration programme.newsroom@abnnewswire.net (Asia Business News)Mosaic Oil (ASX:MOS) Encounters Gas/Condensate Pay At Showground Sandstone Reservoir Target
Mon, 1 Sep 2008 11:04:03 +0900Mosaic Oil (ASX:MOS)(PINK:MSAOF) is pleased to advise that the Taylor-19 gas/condensate development well reached a total depth of 2055 m on 30 August 2008 and will be completed for production initially as a Showground Sandstone gas/condensate well.
Taylor-19 (PL 16, Surat-Bowen Basin, Qld)
Highlights:
- Taylor-19 encountered 3.6 metres net gas/condensate pay in the Showground Sandstone reservoir target
- A possible new pool gas discovery of 23 metres gross thickness was encountered in the Moolayember Formation by the well
- Mosaic Oil has a 100% interest in PL 16.
Wireline logs and a wireline pressure survey have been run. The wireline log interpretation and pressure survey data have indicated that the well encountered approximately 3.6 metres of net gas/condensate pay over an interval from 2008 metres to 2012 metres in the primary target Showground Sandstone Formation.
The results have confirmed the presence of interpreted attic gas/condensate reserves located updip from the Taylor-16 oil and gas producer.
In addition, the well has encountered a gross 23 metres (net approximately 18 metres) of sandstone reservoir with elevated gas readings while drilling of up to 1413 units within the Moolayember Formation from 1917 metres to 1940 metres. Although the interpretation of wireline log and pressure survey data is inconclusive at this stage, the zone is potentially gas-charged. Further evaluation of this zone by cased-hole testing will be undertaken once the Showground Sandstone zone has been produced.
The Taylor-19 well will be cased and suspended with the Century Rig 7. The well will then be completed for production within 2 weeks and is expected to be connected to the Taylor gathering network by as early as the end of September 2008.
Mosaic Oil's Managing Director Mr Lan Nguyen said "Mosaic Oil's 2008 drilling program continues to produce successful wells. This new successful target well confirms the Company's strategic intent of moving 3P and 2P hydrocarbon reserves into proven producing reserves within our Surat-Bowen Basin assets".
"Following a very strong operational and financial performance for 2008, this is again very good news for Mosaic Oil shareholders. The second half of the financial year 2008 was particularly strong, and with more successful wells like Taylor-19 we think that the Company will achieve an increased revenue target of around A$30-A$34 million for the 2009 financial year, " Mr Nguyen said.newsroom@abnnewswire.net (Asia Business News)Exco Resources Limited (ASX:EXS) Confirms The Appointment Of Mr Eamon Byrne As Exco's Chief Financial Officer and Company Secretary
Mon, 1 Sep 2008 10:53:54 +0900Exco Resources Limited (ASX:EXS)(PINK:EXRSF) is pleased to confirm the appointment of Mr Eamon Byrne as Exco's Chief Financial Officer and Company Secretary with immediate effect.
Mr Byrne is a qualified accountant with over 20 years experience in the mining and resources industry. Prior to joining Exco, Mr Byrne worked for Albidon Limited, Woodside Petroleum and WMC Resources Ltd on a range of Australian and international projects.
Mr Byrne's appointment follows the resignation of Exco's previous Company Secretary, Mr Mark Freeman. The Board wishes to recognise Mr Freeman's significant contribution to the Company's development over the past seven years.
Mr Byrne joins the management team at a significant time for Exco. The Definitive Feasibility Study on the Cloncurry Copper Project is progressing well, and the Company will be entering key project finance and off-take discussions in the coming months. Mr Byrne's recent relevant experience in the implementation and financing of Albidon's Munali Nickel Project is expected to add significant value through this process Exco's Board and Management team looks forward to working with Eamon as the Company continues to progress its portfolio of Cu-Au-U3O8 projects in NW Queensland.newsroom@abnnewswire.net (Asia Business News)
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