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EPA 175

THE PETROLEUM POTENTIAL OF

EXPLORATION PERMIT (APPLICATION) (EPA) 175

ONSHORE SOUTHEASTERN BONAPARTE BASIN

NORTHERN TERRITORY

AUSTRALIA

Roger Meaney R.A.MEANEY & ASSOCIATES November 2010

R.A.Meaney &Associates November 2010

EPA 175 CONTENTS 1. 2. 3. 4. 5. 6. 7. ABSTRACT INTRODUCTION METHODOLOGY THE COMPANY TENEMENTS AND WORK PROGRAMS INFRA-STRUCTURE GEOLOGY 7.1 Regional Geology 7.2 Tectonic Setting 7.3 Stratigraphy 8. PETROLEUM GEOLOGY 8.1 Source Rocks 8.2 Maturity 8.3 Reservoirs 8.4 Sealing Units 8.5 Traps 9. PREVIOUS EXPLORATION 9.1 Coal Exploration 9.2 Petroleum Exploration 10. R.A.Meaney &Associates November 2010 UNTESTED PLAYS

EPA 175 11. 12. 13. 14. 15. 16. RECOMMENDATIONS RISKS CONCLUSIONS DECLARATIONS SELECTED REFERENCES GLOSSARY

LIST OF FIGURES AND ENCLOSURES FIGURES Figure 1 Figure 2 Figure 3 Figure 4 Figure 5 Figure 6 Figure 7 Figure 8 Figure 9 Location Map Bonaparte Basin Structural Elements Bonaparte Basin Offshore, Stratigraphic Column Bonaparte Basin Generalized Onshore Stratigraphic Column Southern Bonaparte Basin, Stratigraphic Column Onshore Bonaparte Basin Seismic Line and Well location Map Two way Time Map to Base Treachery Shale-Lead Alpha Southern Bonaparte Basin Structural Elements Map Structural Elements, Play Concepts and Seismic and Well Data Base Map

ENCLOSURES Enclosure 1 Shot point and Well Data Base Map Enclosure 2 Structural Elements, Play Concepts and Seismic and Well Data Base Map

R.A.Meaney &Associates November 2010

EPA 175

EXECUTIVE SUMMARY

The onshore sector of the Bonaparte Basin is characterized by many hydrocarbon shows, both oil and gas, in poorly sited wells and shallow mineral holes. Many shallow mineral and stratigraphic boreholes, close to the basin edge, have encountered oil staining, both live and residual. The above point is empirical confirmation that Gussows Theorem, whereby early generated oil has been displaced up-dip and margin-ward, by late generated dry gas. Hence the basin is prospective for both oil and gas. These points prove that the basin contains rich, mature source rocks and is prospective for shallow accumulations of oil and for deeper gas accumulations. The highly truncated basin geometry lends itself readily to hydrocarbon migration The onshore and near offshore sector of the Petrel Sub-basin, the basins southernmost and deepest depocentre, has hydrocarbon shows and recoveries from units ranging in age from Lower Devonian through Lower Carboniferous, Lower Permian to Early Triassic. The area of EPA 175 is well placed with regard to infra-structure to deliver either oil or gas to unsatiated markets. The gas pipe which connects the Blacktip Gas Processing Plant at Wadeye, within the permit, transects EPA 175 and connects with the Amadeus-Darwin Gas Trunkline. The Wadeye Condensate Loading Facility is located immediately offshore from Wadeye. The Petrel Sub-basin is now producing gas and condensate from the Early Permian Keyling Formation at the offshore Blacktip Gas Field. The other sub-basins of the offshore Bonaparte Basin are also oil and gas productive from the Mesozoic section, from units ranging in age from Late Cretaceous to Late Triasssic. Unusually for Australia the Bonaparte Basin, particularly the Petrel Sub-basin, contains structural traps formed by salt tectonics. These types of traps are particularly productive in the Gulf Coast Basin of Texas and Louisiana in the United States of America. The famous Spindletop and Jennings salt domes, amongst many, are of this genesis. The quality of seismic data acquired in the onshore Bonaparte Basin is extremely poor and an extensive experimental recording program will be required before new data is to be acquired. Most of the wells drilled to date are not valid crestal tests. It is generally thought that reservoir quality and continuity is problematical in the onshore sector of the basin. However there are indications that much reservoir damage has been done during drilling operations. In light of the above observation it is recommended that extreme care should be taken in drilling fluid selection.

R.A.Meaney &Associates November 2010

EPA 175 Structural traps immediately adjacent to and on the down thrown side of faults should be seismically delineated and tested. Several leads of this play have been identified, in particular Lead Alpha. Structures of a salt or diapiric genesis should also be seismically delineated and unambiguously tested. Several leads of the play have been identified. Exploration should be restricted to the southwestern portion of EPA 175, west of the Moyle Fault. A range of structures, extending east to west, from adjacent to the down thrown side of the Moyle Fault to the coast, should be tested. Using indicative reservoir parameters the identified structural Lead Alpha situated on the down thrown side of the Moyle Fault could host a possible oil in place resource of 248 million barrels (MMBBLS) or a recoverable possible resource of 157 MMBBLS. If the structure was found to host gas then the corresponding possible gas resource cases would be 2.6 trillion cubic feet (TCF) or 2.2 TCF, respectively. Several leads of a similar size and origin have been identified and several leads of a salt induced nature, of a similar areal extent, have also been recognized. ABSTRACT

1.

Bonaparte Oil Limited (Bonaparte Oil) is a private company incorporated on 18th January 2010. with the objective of exploring for, discovering and eventually developing, producing and commercializing, hydrocarbon accumulations in the onshore sector of the Bonaparte Basin in the Northern Territory (NT). In an attempt to address this objective the company applied for and was subsequently awarded Exploration Permit (EP) 175 in the Wadeye, formerly known as Point Keats, area of the Northern Territory. An offer of this permit has been made to the company, and subject to an appropriate Native Title settlement being concluded, the tenement will be formally awarded to Bonaparte Oil, until then its formal designation is Exploration Permit (Application) (EPA). The principal of the company is involved in the petroleum exploration in other sedimentary basins in the NT and some of the States of Australia. And as such is versed in overseeing exploration projects. Other companies associated with Bonaparte Oil and its principal hold other exploration tenements or have submitted applications for acreage in the onshore Canning Basin of Western Australia (WA) and in the sector, in South Australia (SA), of the Cooper/Eromanga Basin Complex. Bonaparte Oil and its associated companies are actively assessing exploration opportunities in other prospective basins in Australia. This report is exclusively focused on Bonaparte Oils onshore Bonaparte Basin acreage. To fulfill its aim, the company has acquired an under-explored but prospective petroleum exploration tenement, EPA 175, which abuts the coast and contains and surrounds the Aboriginal settlement of Wadeye, in the onshore sector of the hydrocarbon productive Bonaparte Basin, southwest of Darwin. The offshore sector of the Bonaparte Basin produces both oil and gas, and sub-commercial accumulations of oil and gas have also been discovered in the onshore sector of R.A.Meaney &Associates November 2010

EPA 175 the basin in both WA and the NT. Infrastructure to produce a gas discovery in EPA 175 is already in place with the gas processing plant at Wadeye and the pipeline connection via the Amadeus-Darwin Gas Pipeline to Darwin. This infra-structure is associated with the recent development of the offshore Blacktip Gas Field. Besides Darwin other, unsatiated, gas markets are present in the NT. The alumina plant at Nhulunbuy, a long standing potential gas market, is still to be supplied. The Territory capital is a ready market and port, with gas-processing, liquefaction and loading facilities. These facilities were constructed to produce the large Bayu-Undan gas and condensate accumulations in the Timor Sea, northwest of Darwin. Hence liquefied natural gas (LNG) could be exported from Darwin if a large enough discovery is made. Oil could also readily disposed of as offshore oil and/or condensate loading facility is located some two kilometres offshore Wadeye. There is a ready market for sweet, light Australian crudes which normally commands the Tapis price which sells at a premium to the more commonly known West Texas Intermediate oil price. Oil, which has been discovered and produced in the Timor Sea at the Laminaria, Corallina and Buffalo, Oil Fields, amongst others, is more easily transportable, more profitable and more readily able to be developed than is gas. Condensate rich, but sub-commercial gas flows, has

been encountered in quite a few wells in the onshore sector of the basin, at the Weaber Gas Field in Retention Lease (RL) 1 in the NT, Kulshill 1&2, located in EPA 175, Keep River 1, just south of the tenement, and Ningbing 1&2 and Waggon Creek 1/1A and Vienta 1 in WA. As indicated above, an offshore liquids loading facility is located at Wadeye. Modest oil discoveries could also be developed, with modular, on-site dieseline refining facilities, for local markets in northern Australia.

This permit, EPA 175, whilst lightly explored, contains three wildcat exploration wells which were drilled by Australian Aquitaine Petroleum Pty Ltd (Aquitaine) in the mid 1960s. These wells are Kulshill 1, Kulshill 2 and Moyle 1 all located in the southwest of the tenement. Two of which, Kulshill 1 and Kulshill 2, have recorded strong hydrocarbon indications, both liquids and gas. The third of these wells, Moyle 1, a stratigraphic test which penetrated a thinner section, not surprisingly, did not encounter any hydrocarbon indications. Further south in the onshore sector the yet to be developed Weaber Gas Field is located in RL 1. The Keep River 1 well, from which a sub-commercial gas flow was recorded in 1969, is also located to the south, as is the very rudimentarily located well, Spirit Hill 1, from which hydrocarbon indications are also reported. R.A.Meaney &Associates November 2010

EPA 175

R.A.Meaney &Associates November 2010

EPA 175

Further to the southeast is the Bulloo River 1 well, sited to investigate the Bulloo River oil seep. Bulloo River 1 was a wildcat/ stratigraphic well located without seismic data. Bonaparte Oil has no interests in either RL 1, nor in EPA 126. The area south and east of EPA 175 also contains many mineral exploration drill holes in which significant intervals of oil staining and some live oil were encountered. These indications of oil are located near the basins southeastern margin, and to a lesser extent, eastern margin. This indicates that a large charge of oil has reached the basin margin and it proves in an empirical sense that one the most important requirements for an accumulation of hydrocarbons, namely the presence of rich and mature source rocks, has been met in the basin. This is very significant and is supported by geochemical analyses of cores from deeper oil and gas exploration wells drilled further away from the basin margin. This indicates that the so far un-scientifically tested play, structural traps which are located immediately down dip of the basin margin, should be pursued as a matter of priority. Several leads of this type have been recognized on the sparse poor quality seismic grid present in the block. A two way time structure map, prepared by a former operator Aquitaine, of Lead Alpha, which is representative of this type of play, is shown as Figure 7. This lead, as with all others, will require additional seismic detailing. An appreciable amount of coal drilling has also been conducted in the Port Keats area. This drilling which was conducted for the South Australian Department of Mines began in 1906 and deep bores were drilled in the Port Keats, Cape Hay, Cliff Head and Anson Bay areas. This drilling was abandoned in 1909 when the coal seams were found to be thin and not continuous. This coal later became known as the Upper Permian coal seam. Deeper buried Early Permian coals were intersected in the Kulshill 1, and Kulshill 2 petroleum exploration wells, drilled in the mid 1960s. These intersections spurred on a second phase of coal exploration in the Port Keats area. The results of this exploration were the same as those of the earlier drilling, that is again it was found that the coals were thin, discontinuous and of no appreciable areal extent. It was also concluded that the coals were contained within unconsolidated sediments and hence could not be mined by either open cut or underground methods. As a consequence of this drilling, the potential for coal bed methane drainage (CBM) within EPA 175 is considered by the author to be negligible. Extensive drilling would have to be undertaken to fully evaluate the CBM potential of EPA 175, which appears to be minimal. It should also be noted that salt diapirism has been proven in the near offshore area and near coastal sections of Petrel Sub-basin, the basins deepest and most southerly depocentre. Gravity surveys in adjacent onshore acreage in WA indicate the presence of low density section, thought to be halites. This has been confirmed by drilling. This play, which is also unambiguously tested, warrants investigation as well. It too will require seismic acquisition. The perceived timing of generation and migration of hydrocarbons will determine the ideal test site, R.A.Meaney &Associates November 2010

EPA 175 on any salt generated structure. Salt formed structures should be tested on both the crest and flank of the structure to unambiguously evaluate the feature, given the uncertainty of the timing of hydrocarbon migration. Whilst the most recent target in the onshore Bonaparte Basin has been gas, the results of this study indicate that the permits are very prospective for oil as well as gas. In a practical sense this is also important as oil is far more profitable than gas and the oil is more likely to be located near the basin margin at shallower depths, hence drilling costs will be cheaper than for the deeper, more basin-ward, gas exploration wells. It has been, and still is, conventional wisdom that the greatest impediment to successful exploration and of eventual hydrocarbon production from the onshore sector of the Bonaparte Basin is the lack of good quality and continuous reservoir rocks. It is the authors opinion that this may be in error as studies from cores from deep petroleum wells, and empirical results from drillstem tests, indicate the presence of reservoir quality rock. This is also supported by sedimentological studies, conducted on core and cuttings samples from onshore and offshore wells, by several former operators in the Bonaparte Basin. This is also true of one of the last operators in the Weaber area and the adjacent permit in WA, Amity Oil Limited N.L. (Amity). In a similar sense, these studies also show the presence of sealing units in an inter-bedded sequence of coarse sandstones (=clastics) and finer siltstones and shales. This is also proven by the empirical results of some of the wells within and near the permit area, several of which flowed, for some time at least, at commercial rates. The best of these was at the Weaber1 gas discovery well which flowed gas at the rate of 4.5 million cubic feet a day (MMCFD). Clearly this value, if sustained, and duplicated in appraisal wells, is a commercial rate. Interestingly the operator of the abovementioned discovery well, Aquitaine, was of the view that the section with hydrocarbon shows was tight and not worth drillstem testing. As a consequence the well was plugged and abandoned without a test. In due course the well began leaking gas and a subsequent operator, Santos Limited (Santos), at the request of the NT Department of Mines and Energy, reentered and tested the well and obtained the abovementioned flow. It is known that most of the wells drilled in and around the permit, and all through the onshore sector of the basin, are not valid tests, as they are not located on the crests of the structures and hence are not definitive evaluations of the structures hydrocarbon bearing potential, nor of the reservoirs deliverability. Most wells in the area have encountered indications of hydrocarbons. It is the authors opinion that the reservoirs may have been damaged during drilling. Reservoir damage is a serious problem in some intervals of hydrocarbon saturation of basins in eastern Australia. The results of this study have established that the onshore sector of the Bonaparte Basin fulfils all the requirements for the hosting of hydrocarbon accumulations, namely:-

R.A.Meaney &Associates November 2010

EPA 175 The presence of rich mature source rocks The presence of reservoir quality rocks and carrier beds The presence of sealing units The presence of traps, both of a structural and stratigraphic genesis The appropriate timing of formation of structures with regard to the prime hydrocarbon charge

It is the authors view that, to the present, the lack of commercial exploration success in the area of Bonaparte oils permit, and the entire onshore sector of the basin, has been due to the difficulty in acquiring acceptable quality seismic data, due to the poor coupling ground conditions of the black soil plains and the rocky sandstone out crops. This prevents the preparation of accurate sub-surface two way time (TWT) maps and hence the identification of valid and robust traps. The abovementioned problem should be able to be solved relatively cheaply. 2. INTRODUCTION

Bonaparte Oil Limited applied for EP 175 during 2009 and were subsequently offered the tenement in September 2010. The initial term is for five years and then the tenement can be renewed after a fifty percent areal relinquishment for a second 5 year term, again with a second fifty percent of the original permit to be relinquished. Hence all of the tenement, other than areas converted to Production Leases or Retention Leases, will be surrendered after 10 years. The tenement is currently held by Bonaparte Oil as an Exploration Permit (Application) (EPA) until a satisfactory agreement is reached with the various clans who constitute the Native Title claimants for the areas containing the tenement. Upon such an agreement being reached the NT department of Mines and Energy will formally award the tenement to Bonaparte Oil. Bonaparte Oil have the first right of refusal for EPA 175. The initial exploration target was gas, both conventional and non-conventional coal bed methane (CBM). However as a result of this study it has become apparent that the CBM potential of the permit area is ill-defined and appears to be significantly constrained. Coal exploration drilling in the Port Keats area by Thiess Brothers Exploration in 1966 and 1967, Utah Development Company in 1972 and Consolidated Zinc Rio Tinto Australia (CRA) 1982 and a literature search by Western Mining Corporation Limited (WMC) in 1982 indicates that the coal potential of the Port Keats area is limited as the coal seams are thin and discontinuous. They concluded that neither open cut mining nor underground mining would be economic in this area. These companies investigated the shallow Upper Permian coals seen in outcrop around the Port Keats area and later investigated by a drilling program from 1906-1909 of the South Australian Department of Mines. The NT was originally the Northern Territory of South Australia until it was transferred to the Federal Government in 1913. They also evaluated the deeper Lower Permian coals which were encountered in the Kulshill 1, and Kulshill 2 oil exploration wells drilled by Aquitaine in 1965-1966 and 1966, respectively. This coal drilling was located in the areas which were considered to be the most prospective areas for coal development. Whilst there may be other un-drilled localized depocentres R.A.Meaney &Associates November 2010

EPA 175 containing thicker and more extensive coal seams, such areas will not be areally extensive. It is the view of the author that the EPA has negligible potential for CBM production and hence nonconventional gas production. Given the many aquifers present in the section and the high water table, as well as the paucity of coal seams, underground coal gasification would also appear to uneconomic and unsuitable in EPA 175. Given the good hydrocarbon shows in Kulshill 1 and Kulshill 2, both oil and gas, the oil show in Spirit Hill 1, the sub-commercial gas flow from a drillstem test of the Permian section of the Aquitaine Keep River 1 well, the similar subcommercial gas flows from some of the Weaber wells, the onshore sector of the Bonaparte Basin has received a gas charge and hence is prospective for conventional gas. This is also evidenced by gas shows and/or flows from Bonaparte 2, Ningbing 1, Ningbing 2, Garimala 1, Skull 1, Waggon Creek 1/1A, and Vienta 1 wells in the WA sector of the onshore portion of the basin. Oil has been discovered, but not in commercial quanties, in the near-shore sector of the Petrel Sub-basin. Given the many oil shows in shallow mineral holes and oil exploration wells it is evident that an oil charge has reached the basin edge. This is empirical confirmation of the operation of Gussows Theorem, whereby source rocks are buried deeply enough to generate dry gas. This dry gas spills earlier generated and trapped oil from the base of structural traps, up-dip and towards the basin margin. This usually indicates the following conditions: The source rocks have passed through both the oil and gas generative windows Rich and mature source rocks are present in the basin The presence of conduits from the deeper hydrocarbon generating kitchens to the shallower traps A corollary of this is that stratigraphic traps deeper in the basin may contain oil down dip of gas accumulations

Hence the permit is also quite prospective for oil. Consequently, the focus of future exploration should be biased towards oil and that gas should be a secondary, but still valuable, target. Any oil exploration drilling should commence near the basin margin and move basin-ward. Fortuitously Aquitaine has recognized several structural leads, on the limited seismic coverage present in the permit, close to the basin margin. These features are fault dependent closures and have been confirmed by the consulting group Petroconsultants Australasia Pty Ltd (Petroconsultants) and by the author of this report. A two way time map of the Base of the Permian Treachery (Shale) Seismic Marker for one of these leads, Lead Alpha, is shown as Figure 7. Lead Alpha corresponds to Lead (iv) and is shown in Petroconsultants report on the Bonaparte Basin which was prepared for the NT Department of Minerals and Energy. These leads, which require further seismic delineation, should be addressed in the first stages of any exploration program. The locations of these leads are shown on Enclosure 2, a fullscalecomposite structural elements, play concepts and seismic and well data base map. A condensed A4 sized version of this drawing is also included as Figure 9.

R.A.Meaney &Associates November 2010

EPA 175 Interestingly this area of northwest Australia hosts the first reported encounter of one of Australias few recorded oil seeps, that at the mouth of the Victoria River in the NT, south of Bonaparte Oils acreage. In 1839 sailors from HMS Beagle recovered oil in shallow water wells dug on the banks of the Victoria River. They used the bitumen recovered from these wells to caulk their long boats. The presence of oil seeps has lead to the discovery of many major oilfields around the world namely in the United States of America (USA), the Middle East, Middle East and the area of the Black and Caspian Seas formerly in the Union of Soviet Socialist Republics (USSR). The lack of oil seeps in Australia was used, erroneously, to discount the oil potential of Australia, amongst many academic geologists and major oil companies. Another earlier reported oil seep in the Bonaparte Basin area was confirmed during field mapping in 1956 by Mines Administration Limited (Minad), the technical arm of the Associated Group, which discovered and developed the Roma Shelf Gas Fields of Queensland. A Minad field party located and confirmed the existence of a reported oil seep near the Bulloo River in this general area. This oil seep was drilled, unsuccessfully in 1984. by Queensland Petroleum Limited in their Bulloo River 1 oil exploration well. This well was sited with gravity data without seismic recording and is probably not a valid structural test. An oil seep is also reported to the south west of Bonaparte Oils block just across the State border in WA. This seep was discovered by Walter Oakes, a returned service man, who had become familiar with oil, after conversations with American soldiers in France during World War One. He discovered a seep at the junction of the Ord and Negri Rivers in 1919, ironically on Texas station. A company, Oakes Durack Oil Company, was formed and an unsuccessful shallow well was drilled nearby in 1923. It is now known that the well is located near the zero edge of the Bonaparte Basin, in the Paleozoic Ord Basin, and that it could have been sited in a more optimal, and basin-ward location, to intersect a thicker sequence of sedimentary rocks. These seeps were the harbingers of the fact that the Bonaparte Basin is hydrocarbon bearing and were precursors of the large gas discoveries made in the offshore sector of the basin in the 1970s and the more recent oil discoveries. They were specific indicators of the large, but to date undeveloped, gas discoveries in the Early Permian Hyland Bay Formation at the Tern and Petrel Gas Fields in the offshore sector of the basin made in the 1970s by the Atlantic Richfield Company (Arco) and Australian Aquitaine Petroleum Pty Ltd (Aquitaine) consortium. These were made in both WA and the NT waters, respectively, in the Petrel Sub-basin. At a similar time, 1974, The Burmah Oil Company of Australia Limited (Burmah) and Woodside Offshore Petroleum (Woodside) consortium discovered the huge, soon to be developed, Sunrise and Troubadour gas fields on the Sahul Platform in the far north of the basin. These hydrocarbons are reservoired in the younger Jurassic aged Plover Formation in the two discovery wells, Sunrise 1 and Troubadour 1. Later several other yet to be developed, gas and condensate discoveries were made in the Timor Sea. The sub-domains of the Bonaparte Basin are shown in Figure 2, structural elements of the Bonaparte Basin. Due to the better economics of oil, most of the later oil discoveries made since the 1980s, in the southern Timor Sea sector of the basin, in the Vulcan Graben, Ashmore Platform, and Londonderry High areas to the west, were quickly placed on production. Again the producing intervals were mainly Jurassic or Triassic in age. R.A.Meaney &Associates November 2010

EPA 175

Several large gas discoveries, including Bayu and Undan and some large oil discoveries, Elang, amongst others, were made in the Zone of Co-Operation, now the Joint Development Area, during the 1990s. In spite of the very high success rate in drilling in the offshore Bonaparte Basin there has been little commercialization to date. The exceptions being the combined Bayu-Undan Gas Field developed by Conoco-Phillips and Blacktip, a gas field discovered by Woodside Offshore Petroleum Limited but developed by the Italian company ENI. The greatest impediments to development have been primarily a lack of markets and the remoteness of the area. The first of these two constraints are steadily being overcome due to the general and accelerating development of northern Australia and the shortage of gas which is able to be developed cheaply and quickly. The second constraint is still to be addressed. The above constraints also apply equally to the onshore sector of the basin, but with the added complication of decreasing and hence non-commercial, gas flows with time and the intersection only of oil staining, and not oil flows. Hence a commercial accumulation is yet to be discovered in the onshore sector of the basin. Yet another impediment has been the failure to record seismic data of sufficient quality to clearly image the subsurface and to be able to prepare accurate sub-surface maps. This has resulted in almost blind drilling, with wells sited in non-optimal locations. This non-optimal siting of wells may be affecting apparent reservoir performance and deliverability. This problem can also be overcome, with a greater seismic acquisition effort and the better instrumentation available now. The better seismic processing suites in current use will also aid in noise suppression, which will also result in increased seismic resolution and eventually better subsurface maps. Improved drilling procedures, drilling fluids and formation evaluation techniques will also be of great assistance. With these improvements, successful exploration for, and commercial development of, the hydrocarbon resources thought to be hosted in the onshore sector of the basin, should speedily follow. A new focus of exploration should be instigated with exploration activity and drilling biased towards the shallower, cheaper to drill and oil prone basin margin. Traditionally oil is six times more profitable than gas and the cash flow is almost instantaneous as it can be trucked to ports, railheads or refineries. Modular, easily expandable portable refineries are available and can be installed on-site, they are ideal for producing distillate which is widely used in northern Australia There is a ready market for dieseline across northern Australia. It should also be noted that much further evidence that the onshore sector of the basin is hydrocarbon bearing has been encountered in shallow mineral drilling near the basin edge, in the southeast. In a search for Mississippi Valley type base metal mineralization many intervals of oil staining, up 15 metres thick, have been intersected in diamond drill holes at depths ranging from 45 to 235 metres. Many of these drill holes are located to the south east of Bonaparte Oils block, EPA 175. Oil staining is also reported from the western margin of the basin in onshore WA. This

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EPA 175 illustrates that a major oil charge has been generated and expelled and that it has reached the basin margin, the limit of possible migration. 3. METHODOLOGY

The basis of this study was an open file study of all the data available on the onshore sector of the Bonaparte Basin in the Northern Territory and in Western Australia. Much data from the near shore portion of the offshore sector of the basin was also reviewed as well as published literature on the Bonaparte Basin in general. The study was hampered and delayed by the unavailability of many open file reports, which are not available in the NT Department of Minerals and Energy library in Darwin, nor in digital form. However the Department was most helpful in providing access to the data in their possession. Some of the reports listed on the Departments data register do not appear to have been submitted to the Department. However a former operator graciously provided a copy their shot point and well data base for portion of the NT and WA sectors of the onshore portion of the basin, A full scale seismic shot point and well data base map is included as Enclosure 1. The same data base is shown at a larger scale in Figure 6, a smaller A4 sized version. That company also provided some well completion reports of some of the more recently drilled wells. All available well completion reports, seismic survey final reports, gravity survey final reports, geological and geophysical reports, geochemical reports and relinquishment reports were reviewed to obtain a better understanding of the basin and its prospectivity. Reports from mineral and coal exploration drilling were also reviewed. A study of the potential of the Bonaparte Basin done for the NT Department of Mines and Energy by Petroconsultants Australasia Pty Ltd was most helpful. The onshore portion of the Bonaparte Basin appears to be quite prospective for hydrocarbon accumulations, particularly oil. 4. THE COMPANY

Bonaparte Oil Limited is fully owned by the principal of the company He has much experience in resource exploration, both in a technical and a business sense. The principal is associated with other private companies with interests in or investigating acquisitions in other petroleum tenements in producing basins in Australia. The company also has access to very experienced consultant geoscientists with extensive experience in oil and gas exploration, drilling and development in both offshore and onshore environments. 5. TENEMENTS AND WORK PROGRAM

The company in its own right, holds the first right of refusal to a prospective exploration permit (application) in the onshore sector of the Bonaparte Basin, namely EPA 175. The company has been offered the permit by the NT Department of Mines and Energy. Upon reaching a successful

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EPA 175

R.A.Meaney &Associates November 2010

EPA 175 agreement with the Native Title claimant groups for the areas containing EPA 175, the tenement will be formally awarded to the company, which then has first right of refusal. This basin is hydrocarbon productive in the offshore sector and the hosts the giant Bayu-Undan Gas Field which has been developed, as well the soon to developed Sunrise and Flamingo Gas fields, amongst others. These fields are located in the Sahul Platform in the Joint Development Area, which is administered jointly by Australia and Timor Leste (=East Timor). Other large gas and condensate discoveries have been made, closer to Australia in the Petrel Sub-basin, in Australian territorial waters in the Petrel and Tern Gas Fields located in the NT and WA sectors of the Sub-basin, respectively. The recently developed Blacktip Gas field is also located in the WA sector of this Sub-basin, although the gas processing plant and condensate loading facility are situated in the Wadeye area of the NT. Good gas and oil shows are reported from two of the three petroleum wells drilled in EPA 175, namely Kulshill 1 and Kulshill 2. Due to the sparse seismic grid used to position these wells it is problematic that these wells are valid crestal tests. The other well in the tenement, Moyle 1, is essentially a stratigraphic well which drilled a much thinner section located in a more marginward, eastward, position across the regional Moyle Fault from the Kulshill wells. Gas has been flowed from inappropriately sited exploration wells located to the south of EPA 175. Several drillstem tests had flows which were initially, numerically commercial, but unfortunately the flows diminished to sub-commercial levels. This is particularly the case for some of the Weaber wells and also for Keep River 1. Oil and/or condensate have also been recovered from some of these wells and from shallow mineral exploration drill holes. Permit EPA 175 covers the northeastern onshore sector of the basin. The eastern half of the permit only has a thin veneer of sediments present and is not prospective. The western half of the tenement, west of the basin bounding faults has a much thicker sedimentary section and is prospective. Exploration should be concentrated in the southwest of the tenement. The area of exposed or shallowly buried basement which is non-prospective is shown in Figure 2 as the area of exposed crystalline basement, the Sturt Block and metamorphosed Pine Creek Geosyncline. The permit, EPA 175, is located in the onshore sector of the Bonaparte Basin, southwest of Darwin. It contains the Wadeye Aboriginal Settlement, the Blacktip Gas Processing Plant and the Blacktip Condensate Loading Facility is located just offshore Wadeye. The tenement is transected by the gas pipeline from the Blacktip Gas Plant to the Darwin-Amadeus Gas Pipeline, main trunkline. The tenement covers some 12,600 km2 or all or part of 174 graticular blocks. Each graticular block is equivalent to an area of 25 square nautical miles, or 5 minutes of latitude by 5 minutes of longitude. Application was for a five year term, with a renewal of fifty percent of the original permit area. The proposed work program and estimated minimum expenditure is: YEAR 1 Geological and Geophysical studies Seismic reprocessing Field work Estimated minimum expenditure $200,000 R.A.Meaney &Associates November 2010

EPA 175

YEAR 2 Acquire 100km of seismic data Seismic processing and interpretation Ongoing Geological and Geophysical studies Estimated minimum expenditure YEAR 3 Drill site preparation Drilling of a 300 metre exploration well Ongoing Geological and Geophysical studies Appraisal drilling if warranted Initiate production, if applicable Estimated minimum expenditure YEAR 4 Acquire 100km of seismic data Seismic processing and interpretation Sub-surface studies Estimated minimum expenditure YEAR 5 Drilling of a 4,000 metre exploration well Appraisal drilling, if warranted Initiate production, if applicable Geological and Geophysical studies Estimated minimum expenditure

$1,000,000

$4,500,000

$1,000,000

$4,500,000

The above expenditure is associated with a proposed detailed work program, which has been submitted to the NT Department of Minerals and Energy, however this program can be varied to some degree but the listed expenditure must be met. It is likely that the work program will be varied in light of the results of this study. 6. INFRA-STRUCTURE

EPA 175 is well placed with the necessary infra-structure to quickly commercialize a discovery, either oil or gas present. The companys permit is located in the Wadeye (=Port Keats) area of northwestern Australia, immediately east of the recently developed Blacktip Gas Field. The soon to be developed Petrel and Tern Gas Fields are located further offshore to the northwest. Wadeye is the location of the onshore gas processing plant, owned by the Italian multi-national company, ENI, built to produce the offshore Blacktip Gas Field. A gas pipeline connects the Blacktip Gas Field to the processing plant at Wadeye and a further pipeline connects with the Amadeus-Darwin gas pipeline to the Darwin domestic gas market and the gas fired power station in Darwin. This pipeline transects Bonaparte Oils permit. R.A.Meaney &Associates November 2010

EPA 175

More importantly a marine oil/condensate loading facility is located two kilometers offshore from Wadeye for the shipment of liquid hydrocarbons. Hence infrastructure is well established in the area and is shown, with the permit location, in Figures 1 and 6 and Enclosures 1and 2. Ready gas markets exist in Darwin and possible markets are in Kununurra, Wyndham, Katherine and the long mooted market at Alumina Plant at Nhulunbuy in east Arnhem Land, amongst others. In the event of the discovery of modest oil or gas accumulations other marketing options could become viable. Gas could be compressed, liquefied and transported by road to local markets in northern Australia, such as Katherine, Kununurra and Wyndham, amongst others. Such a procedure was utilized with some smaller Amadeus Basin gas fields. Markets for dieseline locally refined from oil are even more widespread. Oil could be shipped to the refinery at Kwinana, WA or those in the eastern States or even to those in Victoria. Oil could also be exported from Wadeye, if a large enough discovery is made. If a modest oil accumulation is discovered then a modular on-site dieseline refinery could be established and diesel trucked to local markets in northern Australia for transport, use in mines and even local power generation amongst others. Such refineries exist at Eromanga and Inland in Queensland. Australian crudes are rich in the gasoline and dieseline fractions and only require rudimentary processing and as such lend themselves readily to these simple refineries. Northern Australia is a very large per capita user of dieseline. Australia is rapidly becoming very deficient in oil production, hence oil has a ready market is present. If local processing is pursued, then in either case, a graveled road connects Wadeye to Darwin via the settlements of Daly River and Adelaide River and the Stuart Highway. There is an all weather connection via the Stuart Highway to Alice Springs. There is also a connection to the Kimberly via the Victoria Highway and via the Barkley Highway to western Queensland. In either case small accumulations could be developed quickly and profitably. 7. GEOLOGY

The Bonaparte Basin is one of a number of sedimentary basins located along the western and northwestern margins of Australia. Hydrocarbons have been discovered in all of these basins. Several of the northern-most basins have a similar genesis and geological section. 7.1 Regional Geology

The Bonaparte Basin is located in northwest Australia in both the NT and WA and covers an area of approximately 270,000 square kilometres. It is believed to contain, in the basin depocentre, up to18 kilometres of sedimentary section along with some volcanic flows. These rocks range from Cambrian to Cainozoic in age and hydrocarbons have been discovered in many R.A.Meaney &Associates November 2010

EPA 175 intervals. Much of the sequence has been eroded from the onshore sector of the basin. It is essentially triangular in shape with the apex located onshore in the Joseph Bonaparte Gulf area. The onshore sector extends over an area of approximately 18,000 square kilometers, spread pretty much equally in WA and the NT. The basin outline and its location are shown in Figure 2. This drawing shows the area of outcrop of crystalline and/or metamorphic basement. The basin results from failed rifting and is fringed by strike slip faulting, particularly in the onshore portion of the basin near its southern margin. The basin is floored by tilted fault blocks, which dip basin-ward. In the onshore sector, these blocks are believed to be composed of course to medium grained clastic, evapouritic and carbonate sediments of Upper Devonian to Lower Carboniferous age. These sediments are predominately marine in nature and are interpreted to be pre-rift and are believed to have been deposited before the development of the Bonaparte Rift, a distinct linear, down faulted depression. Crustal thinning and subsequent subsidence occurred in the central part of the rift between the two major bounding faults and the pre-rift fault blocks which were unconformably overlain by fine grained, predominately syn-rift, sediments which were in turn blanketed by post-rift sediments. These latter sediments, which thicken northward and basin-ward, have been eroded from the onshore sector of the basin but are quite thick in much of the offshore sector. 7.2 Tectonic Setting

The Bonaparte basin has its genesis in Early to Mid Palaeozoic transcurrent wrench faulting within the northeast trending Halls Creek Mobil Zone. The basin abuts the Proterozoic Kimberly Block to the west and the similarly aged Sturt Block to the east. Areas of basement rock are shown on Figure 2, a regional structural elements map. The basin overlies the Halls Creek Mobile Zone, which controlled its genesis, via predominately northeast trending strike slip faulting, from the Mid Proterozoic until the Mid Paleozoic The eastern boundary of the Halls Creek Mobile Zone, the Cockatoo Fault, coincides with the eastern boundary of the Bonaparte Basin. However conjugate northwesterly faulting is present on the southwestern margin of the basin in onshore WA. It is thought that that both the Bonaparte and the nearby Canning Basins are the products of a failed rifting system which formed part of a major Devonian rift extending down what is now the continental margin of northwest Australia. The basin plunges northwards under the Timor Sea, where the thickest and youngest section is encountered. The basin was laid down on a relatively unmetamorphosed economic basement of Proterozoic rocks and Lower Cambrian volcanics, both of which can be seen in outcrop on the southern edge of the basin. The Pincombe Ridge, a northeast trending basement Inlier, subdivides the onshore sector of the basin into the Carlton Shelf of WA and the Burt Range Shelf (=Syncline) of the NT. Both of these Shelves open into the offshore Petrel Sub-basin. The southern end of this sub-basin extends onshore. The major structural elements are shown in Figure 2. The Bonaparte Basin is floored with tilted, rotated fault blocks of Upper Devonian to Late Carboniferous sediments of a marine origin. They are predominately coarse to medium grained clastics, evapourites and carbonates of pre-rift genesis and they are contained in the Cockatoo, R.A.Meaney &Associates November 2010

EPA 175 Ningbing and Langfield Groups. These rocks were deposited in a distinct linear fault-bound depression. During rifting and subsidence the syn-rift sediments of the Carboniferous aged Weaber Group were laid down, unconformably, on the pre-rift tilted and rotated fault blocks. This unit ranges in composition from basal submarine fans, through offshore sandstones, deltaic, interbedded fluvio-deltaic to fluviatile sediments reflecting a shallowing of the basin. It is thought that since the Lower Permian, in which the entire Bonaparte Basin slowly down warped, the Central Rift of the basin was a locus for sedimentation. This deposition finally encroached onto the adjacent shelves of Proterozoic basement rock. These post Lower Permian sediments are post-rift in nature and blanket the earlier pre-rift and syn-rift sediments. The postrift sediments were uniform across the basin proper but have been eroded from most of the onshore sector. Prior to the- post rift sedimentation, the basin was composed of several distinct sub-basins, each of which had its own depositional regime, each of which is unique. 7.3 Stratigraphy

There is some confusion regarding the stratigraphic sequence contained in the onshore sector of the Bonaparte Basin. The stratigraphic nomenclature used in this report is a composite of that of Amity, the last active operator in the onshore area, and that of the previous operator Santos, whose stratigraphic column is more consistent with that of Aquitaine, an even earlier and long standing former operating company in the onshore and offshore sectors of the basin. Santos and Amity explored south of EPA 175 in the Keep River-Spirit Hill-Weaber area and in WA. A stratigraphic column for the Southern Bonaparte Basin as used by Broken Hill Propriety Limited Petroleum (BHPP) in the offshore Petrel Sub-basin is also referred to for the near offshore sector of the Petrel Sub-basin. Most of the exploration drilling and studies relevant to Bonaparte Oils permits was conducted by Aquitaine. The stratigraphic columns used by Santos, Amity and BHPP are included as Figures 3, 4 and 5, respectively. The former column is applicable to the onshore Carlton Sub-basin of WA, the onshore Burt Range Shelf of the NT and the onshore/offshore Petrel Sub-basin, whilst Amitys is restricted to the onshore sector of both states, particularly around the Weaber Gas Field, and does not include the Petrel Sub-basin. The BHPP stratigraphic column is similar to that of Santos. A much thicker Triassic and Jurassic section is present in the Vulcan Graben to the west and Malita Graben and Sahul Platform to the north. The nature of these Mesozoic sediments will not be further discussed in this report. Post Carboniferous rocks are missing, due to erosion from most of the onshore sector of the basin. Prior to the Lower Permian, the Bonaparte Basin was composed of a number of distinct sub basins, each with its own depositional system. However since the Lower Permian, the greater basin has acted as a single down warping depocentre. Basement to the Bonaparte Basin is relatively unmetamorphosed Proterozoic rocks which are in turn overlain by the basalt flows of the Antrim Plateau Volcanics of Cambrian age Sedimentation, which is not present in the Burt Range Shelf of the NT, began in the Carlton Subbasin of WA when the shallow water marine Carlton Group was deposited from Cambrian until R.A.Meaney &Associates November 2010

EPA 175 Early Ordovician time. This unit is not relevant to Bonaparte Oils permit and will not be discussed in this report. It is believed that an Early Devonian evapouritic unit could be present in the onshore sector. Evidence for this is that many salt diapiric structures have been drilled offshore, the nearest being Pelican Island, just 8 km north of the coastline in WA. Additionally gravity data indicates a less dense section between the Pelican Island 1 and Bonaparte 1 wells, the latter being located onshore in WA. Salt induced structures are known to be present in EPA 175 and offshore Cape Hay. This salt induced structure play needs to be fully evaluated within Bonaparte Oils permit, as it has not been scientifically nor exhaustively evaluated. Diapiric salt structures, which deform younger overlying rocks, form excellent trapping locii. This potential play should be followed up by reviewing all the available gravity data acquired in the permit and acquiring new high resolution gravity data in the northwest of the permit. Any new acquisition of gravity data should be done after a thorough review of existing gravity data. Diapiric structures have been recognized and drilled in the near offshore and onshore sectors of the basin. No rocks of Late Ordovician to Middle Devonian age have been encountered in outcrop, nor in the subsurface in onshore wells. It is not known whether this hiatus is due to non-deposition or subsequent erosion, probably the latter as a result of renewed tectonics. Deposition recommenced in the Late Devonian when the Cockatoo Formation was deposited on the Burt Range Shelf of the NT and the coeval Ningbing Limestone in the Carlton Sub-basin of WA. Most of the latter unit is not present in Bonaparte Oils block and as such will not be discussed in detail here. However some members of the unit group are recorded in the NT and these will be discussed, where appropriate. Amity undertook additional sedimentological studies on the Cockatoo Formation and raised it to group status by subdividing it into many new members. The formation is at least 1542 metres thick on the Burt Range Shelf, south of EPA 175. They did a similar thing to the Ningbing Limestone of WA. Amitys very detailed subdivision of the Cockatoo Formation is: The Ragged Range Conglomerate the lowermost unit which consists of a massive pebble boulder conglomerate and thick cross bedded pebbly sandstones is of alluvial fan origin and contains potential reservoir units The Cyril Sandstone which was deposited coevally in a fluvial environment also contains potential reservoir intervals The Steeple Peak Sandstone which was deposited coevally in a more basin ward fluviotidal enviroment is more interbedded and contains probable juxtaposed reservoir and sealing units, an ideal target zone The Kellys Knob Sandstone a unit of similar genesis to the previous interval Kununurra Formation a shallow, marine. finer grained unit with more potential sealing intervals

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EPA 175

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EPA 175

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EPA 175

The Abney Sandstone another interbedded clastic unit of tidal-fluvial origin with probable juxtaposed sealing and reservoir intervals, is restricted to the Burt Range Shelf The Maudoobar Sandstone a medium, grained well, sorted cross bedded, clastic unit of eolian genesis is also of reservoir quality The Cecil Sandstone a clastic unit composed of fine to medium grained, quartz arenites and pebbly, cross bedded sandstones also exhibits reservoir potential The Hargreaves Formation a medium grained, glauconitic, quartz arenite with minor dolomitic sandstones and siltstones of shallow marine origin. It too, is a potential reservoir interval and should also contain sealing units

During the deposition of the bulk of the overlying Ningbing Limestone (=Group) in the Carlton Sub-basin, the Burt Range Shelf was an area of uplift where no deposition occurred. The only exception to this was during the deposition of the Button Beds, a unit of well-bedded limestones and marine sandstones, which was laid down in a reef margin environment. The different depositional environments east and west of the Pincombe Inlier, the divide between the Carlton and Burt Range Shelves and the presence of shallow marine section may indicate that the Pincombe Inlier was a paleo high at the end of Late Devonian time. This may also indicate that the inlier was a locus for reef growth during the Late Devonian. A definitive test of a reef play has not been drilled in the onshore Bonaparte Basin. The Keep River Group of both Aquitaine and Santos unconformably overlies the Buttons Beds in the area of EPA 175. This Early Carboniferous unit has been further subdivided by Amity into the Langfield Group and overlying Weaber Group. Amity also proposed a further subdivision of each group. Amitys, subdivision for the Langfield Group is: The Burt Range Formation a unit of back reef and inter-fingering calcarenites overlain by non-reefal rocks. The spatial configuration of these rocks should be conducive to hydrocarbon entrapment. It is thought that this unit is a correlative of the Sorby Beds known in outcrop further east of the area of investigation The Enga Sandstone a unit of fine to medium grained quartz arenites and calcareous sandstones of barrier genesis. This is a known reservoir interval which hosts the gas accumulation at the Weaber Gas Field The Septimus Limestone a unit of sandy limestone and thick planar cross bedded limestone and coarse trough cross bedded calcareous sandstone of foreshore and shoreface origin The Zimmerman Sandstone a unit of bioturbated and fossiliferous, medium to fine grained, parallel bedded and cross bedded, quartz arenites and quartz greywackes, as well as laminated siltstones and shales. This unit has all the attributes for hydrocarbon entrapment

Most of the Langfield Group has been eroded off the Carlton Shelf of WA. In the more basin ward section of the acreage, nearer to the coast in the Petrel Sub-basin the combined Langfield

R.A.Meaney &Associates November 2010

EPA 175 and Weaber Groups are known as the Bonaparte Formation (=Beds). It is entirely marine and consists of thick fossiliferous dark carbonaceous shales, silts and sandstones and is estimated to

R.A.Meaney &Associates November 2010

EPA 175

R.A.Meaney &Associates November 2010

EPA 175 be 5000 metres thick in the depocentre. This section has been intersected in the Ningbing 1&2, Garimala 1 and Bonaparte 1&2 wells in WA and in the Weaber 1 well in the NT. Such a section could have generated large amounts of hydrocarbons. The deposition of the Langfield Group was followed by that of the Late to Early Carboniferous Weaber Group which was laid down unconformably on the Langfield Group. Amity has further subdivided this unit into the following members:The Milligans Formation a deep water marine unit of black partly calcareous and fossiliferous shales. This considered to be a prime sourcing unit and is present in all three sub-basins and was known to Santos and Aquitaine as the Milligans Beds The Burvill Formation a unit of fine grained, bioturbated and fossiliferous sandstones with parallel and low angle cross bedding and minor medium to coarse grained, thickly bedded sandy limestones. This member is of offshore genesis and it is not present in the Petrel Sub-basin The Point Spring Sandstone this clastic unit is composed of bioturbated and fossiliferous parallel and cross bedded sandstones. This unit is not present in the Petrel Sub-basin. The Border Creek Member a unit of fluvio-deltaic pebbly sandstones with minor laminated shale and siltstones. This inter bedded unit, which is not present in the Petrel Sub-basin, exhibits reservoir, source and cap rock potential. The Tanmurra Formation a unit of fine grained sandy calcarenites calcareous and dolomitic quartz sandstones, medium grained oolitic calcrudite and sandy calcarenites of deltaic origin. In the Carlton Sub-basin, several additional members of, the Weaber Group, the Waggon Creek Formation and the Utting Calcarenite, respectively, are present immediately above the Milligans Formation; these units are not recognized in the Burt Range Syncline. Their composition is: The Waggon Creek Formation a fine to coarse grained, fossiliferous, massive parallel sandstone and minor conglomerates with locally abundant shale and dolomitic boulders. It is believed to be a submarine fan The Utting Calcarenite a unit of sandy limestone and shale which is of offshore genesis

The Weaber Group is unconformably overlain by a unit known to Amity as the Keep Inlet Formation and to Santos, BHPP and Aquitaine as the Kulshill Formation. This Late Carboniferous to Permian unit forms a blanket cover over all three sub-basins. It consists of medium grained sandstones, pebbly laminated massive and cross bedded sandstones, as well as minor shale with drop stones. It is believed to be of fan delta and glacio-marine origin. Unlike the earlier discussed sediments, the Keep Inlet Formation is not confined to the fault bound proto rift that set up the Bonaparte Basin, but extends onto the adjacent shelves of Proterozoic basement. Hence there are two distinct sedimentary sequences in the Bonaparte Basin, the lower sequence which consists of highly faulted Late Devonian and Early Carboniferous shallow marine sediments restricted to the proto-rift and thick, generally unfaulted Late Carboniferous and Permian marine-deltaic rocks which extend beyond the rift and onlap adjacent basement. Much of the upper portion of this sequence has been eroded from the onshore sector of the basin

R.A.Meaney &Associates November 2010

EPA 175 and as such it will not be discussed in this report, nor will the Mesozoic sediments of the offshore sector of the basin, which are also absent from the onshore sector of the basin. In summary in EPA 175 the primary target interval is the Carboniferous-Permian section, the Milligans Beds (=Formation) and the shallower Kulshill Formation. These are the units which exhibited gas and oil shows in the Kulshill wells. Although where present the late Devonian rocks will also be targets. 8. PETROLEUM GEOLOGY

The fundamental tenets of petroleum geology are quite simple and follow from some of the basic laws of both Chemistry and Physics. To have a hydrocarbon accumulation the following conditions must be met: The presence of organically rich and un-oxidized source rocks, usually shales The burial of these source rocks to depths whereby the organic material begins to expel hydrocarbons, oil first and then with deeper burial dry gas The presence of porous and permeable carrier and reservoir beds to allow the migration of generated hydrocarbons from the hydrocarbon generating kitchens near the basin depocentres to shallower sites of entrapment, which can be reached with the drill bit. The presence of sealing units overlyng the carrier and reservoir beds which inhibit the upward migration of hydrocarbons, which results from the principle of flotation in which less dense materials float on those which are more dense. Water is more dense than is oil, which in turn is more dense than gas. These traps can either be of either a structural or stratigraphic genesis. The existence of traps when the main phase of hydrocarbon generation and expulsion occurred.

Once trapped, hydrocarbon accumulations can be destroyed by later earth movements which can breach traps and igneous events which can oxidize entrapped hydrocarbons. Deeper burial of the potential reservoir rocks which can reduce porosity and permeability, which can reduce fluid transmissivity and consequently destroy reservoir quality. 8.1 Source Rocks

There are many intervals of known source rocks in the Bonaparte Basin sequence. Many of these are in Permian or even younger rocks which generally are not present in the onshore sector of the basin. It is believed that up to two kilometers of post Carboniferous section has been eroded from the onshore part of the basin and the basin extended a lot further onshore. However these post Carboniferous source rocks could have or could still be contributing to the known onshore accumulations because of the geometry of the erosional truncation of these beds. Hydrocarbons generated offshore could be leaking through the erosional zero edges of the R.A.Meaney &Associates November 2010

EPA 175 Permian and younger beds and could be down-loading the older Devonian and Carboniferous units. It is the authors opinion that this is most likely, given the relative nearness of the large hot and dry gas fields at Petrel and Tern in the Petrel Sub-basin of the southern Bonaparte Basin. This hypothesis would be a simple example of Gussows Theorem whereby later generated dry gas displaced previously generated and entrapped oil which could have pushed towards the basin edge as a result of the Principle of Flotation. The Permian section is known to have generated, and hosts, gas offshore, nearby. The oil reservoired on and around the Sahul Platform in the northern offshore sector of the basin is hosted in Jurassic rocks, which are believed to have generated it. This is similar to the case in the western sector of the basin in and around the Vulcan Graben where oil is hosted in the Mesozoic section. This is not the case at the Barnett Oil Field in NT RL 3 nearby in the Bonaparte Gulf, where the oil was recovered from the Carboniferous Kuriyippi Formation. However good oil shows were also noted in the overlying Permian units. Barnett is located in the Petrel Sub-basin. In the onshore sector of the basin, not as much geochemical analysis has been conducted and most of this was done by Aquitaine in the late 1970s and early 1980s. Other later offshore operators undertook some studies. These analyses were undertaken on samples from wells drilled in more basin-ward locations in the basin, although the onshore Aquitaine wells were considered. It is thought that the offshore wells are not representative of the more marginal areas in the southeast, which appear to be the most prospective portions of the onshore sector of the basin, and of Bonaparte Oils block. Amitys later sedimentological work indicates the presence of many possible source rock intervals within the onshore section. These include fluvio-tidal intervals within the Steeple Peak Sandstone, Kellys Knob Formation and Abney Sandstone and the marine sedimentation of the Kununurra Formation, all members of the Cockatoo Group. Shales and limestones of the Ningbing Limestone also exhibit good source potential, as do the micritic shales of the Milligans Formation and the shales of the fluvio-deltaic Border Creek Member of the Weaber Group. Analyses conducted by Aquitaine on samples from the Bonaparte Beds taken from wells located in more basin-ward locations near to the coast, indicate that the organic matter contained in the source rocks is gas prone, although some oil prone samples were encountered near the base of the sequence. Interestingly samples analyzed from the Keep River Group (= lower Langfield Group) taken from wells and mineral bores on the Burt Range Shelf also indicate the presence of oil prone source rocks. It should be noted that all the oil shows encountered in the mineral bores are located in reservoirs immediately beneath the transgressive Bonaparte Beds and Milligans Formation, which could be acting as both source and seal to the underlying units. 8.2 Maturity

Not a lot of quantitative data is available on maturity. However all the qualitative data indicates that analyses carried out on samples from wells on the Burt Range Shelf, indicate oil prone source rocks. Using a geothermal gradient of 30 degrees Celsius per kilometre, obtained from the more basinally located wells of Keep River 1 and Bonaparte 1&2, Aquitaine calculated the R.A.Meaney &Associates November 2010

EPA 175 depth to the oil generating window at 2000 metres. Another former operator, Alliance Petroleum International Limited (Alliance) using data from more marginal wells calculated the depth to the oil window to be 900 metres or near the base of the Milligans Beds. They estimated that the top of the gas generating window was at 600 metres. It would seem that Alliances calculation is closer to the mark as Amity calculated a geothermal gradient of 3.46 degrees Celsius per 100 metres at the Weaber 5 appraisal well on the Pincombe Inlier. This higher geothermal gradient would reduce the depth of burial to the oil and gas windows. Interestingly these analyses and studies of samples from shallow mineral holes indicate that the Late Carboniferous rocks are now in the oil window near surface ground level, indicating much uplift and erosion. Another very interesting point is that the oil recovered from shallow mineral bores near the basin margin is from the same source, even though it is in different units, and that its maturity is of the same level as samples taken from the overlying shales at similar depths. Also analyses carried out on samples from wells on the Burt Range Shelf confirm this and indicate oil prone source rocks are now in the oil window near surface ground level, again indicating much up lift and erosion. These facts are most important as they indicate that the Devonian-Carboniferous section is mature for oil generation and it may still be generating oil at shallow depths near the basin margin. Critically, out in the more basinal area where the section is more deeply buried, the source rocks would now be in, or have passed through, the dry gas generating window, Gussows theorem would be operative and this later dry gas would push previously reservoired oil towards the basin margin. This is postulation is confirmed and supported by empirical evidence. 8.3 Reservoirs

Traditionally the presence of, and the continuity of, reservoirs has been considered to be the greatest impediment to commercial exploration success in the onshore Bonaparte Basin. It is the authors view that this merely represents the fact that most of the early drilling was conducted in more basin-ward locations where the section is finer grained. This is supported by the view of earlier operators who identified better quality reservoirs around the basin margins in both the NT and in WA. There are many known and potential reservoir intervals within the onshore Bonaparte Basin sequence. Historically the prime reservoir targets have been: The Milligans Beds, particularly the sandstones of this unit The Langfield Group, particularly the carbonates of the Septimus Limestone Member and the sandstones of the Enga Sandstone Member of this unit The Ningbing Group, the carbonates of the Ningbing Limestone and the clastics of the Buttons Beds

Reservoirs from within these units have either flowed gas or have had oil recoveries made from them. The largest gas flow was 4.5MMCFD from the Enga Sandstone at Weaber 1, the same unit flowed gas at Weaber 4. There have been four gas flows from reservoirs within the R.A.Meaney &Associates November 2010

EPA 175 Milligans Formation, the first from Keep River 1 in the NT at an initial rate of 3.00 MMCFD, which declined to 0.12 MMCFD after eight hours. The other three flows were, in WA, at Bonaparte 2, which flowed at an initial rate of 1.55 MMCFD and then declined, and at Ningbing 1 and Garimala 1, where oil was also recovered. Oil has been recovered from the Ningbing Limestone at Ningbing 1. It is now known that most of the early wells are not crestal tests of structural traps and these declining flows may only represent intersections of the hydrocarbon columns low down the flank of the accumulation. It does not definitively mean that the sands are isolated and discontinuous. Better quality seismic data should resolve this quandary. The reduced reservoir performance could also mean that the drilling fluids used have damaged the reservoirs and have reduced both permeability and porosity, hence inhibiting flow to the well bore. Much borehole damage is reported from the wells in the Weaber Gas Field. This is a common problem in some basins in eastern Australia and if it is an impediment in the Bonaparte Basin it can be readily overcome by a more judicious selection of drilling mud. Much better drilling muds are now available. The better formation evaluation techniques now available will also help in identifying intervals of hydrocarbon saturation, alleviating another complication. Whilst not a traditional target, the Cockatoo Group has flowed gas at Garimala 1 and an oil recovery was also made from this unit at Ningbing 1. Both wells are located in WA. Amitys sedimentological studies have identified many potential reservoir intervals within this group. The comments made above on reservoir performance also apply to this unit. Keyling and in the Milligans Formation, much the same as in the discovery well and minor amounts of oil were recovered from a well test. These intervals, which are briefly discussed in the section on stratigraphy, may be potential targets in the south of EPA 175, if present, and include: The Ragged Range Conglomerate The Cyril Sandstone The Steeple Peak Sandstone The Kellys Knob Sandstone The Abney Sandstone The Maudoobar Sandstone The Cecil Sandstone These are in addition to the traditional reservoirs around Port Keats, namely: The Tanmurra Formation The Milligans Formation Various units of the Kulshill Group 8.4 Sealing Units

Regional seals in the form of shales are known to be present in both the Bonaparte Beds and the Milligans Formation. The underlying Late Devonian and Early Carboniferous units are more arenaceous, however siltstones and shales are reported by Amity within these units. The previously mentioned vertical juxtaposition of fluvial and tidal units should ensure sealing of R.A.Meaney &Associates November 2010

EPA 175 reservoir beds. Hydrocarbons have been encountered in most wells, so there is empirical evidence of the presence of seals. There is evidence from the Bonaparte 2 well, of fault closure and stratigraphic sand pinchout acting as a seal. If the view of laterally discontinuous sands is correct, then this too will aid in providing seals to hydrocarbon accumulations. Both regional and intra-formational sealing units have been recognized in the section. 8.5 Traps

The onshore sector of the Bonaparte Basin is known to be highly structured and as such, many structural traps can be expected to be present. The reservoir quality sandstones fringing the basin margin are buried to reasonably shallow depths, in the order of 2000 metres. Closure should be present in the tilted and rotated fault blocks with anti-regional dip and fault closure. Much of the faulting in this area is strike slip in nature and this style of faulting often provides fault seal due to the presence of fault plane gouge. Structural closure can also be expected in the syn-rift units overlying and draping these blocks. Many northeast trending and northeast plunging anticlines are known to be present. They are thought to be of Late Carboniferous origin and are doubly plunging and, unless destroyed by later earth movements, should be good traps. In the more basin-ward part of the block to the northeast, these structures are more deeply buried and due to the thicker cover are more likely to have not been breached. The marine nature of the sandstones may also help in providing trapping geometry as they parallel strike and cut across the anticlines providing the opportunity for combination structural/stratigraphic traps. The paleo-high of the Pincombe Ridge, south of EPA 175, is known to have been an emergent high and trapping focus. Its analogue fault zones, if present, further north in EPA 175 should also be locii for structural traps, as much potential exists for drape and compaction traps along and surrounding these regional features. The inter-fingering of coarse grained sandstones with finer grained units, due to lateral facies changes, should also provide stratigraphic trapping geometry. Reservoir quality is known, from mineral exploration drilling, to improve towards the eastern margin in the Burt Range Syncline. Most oil shows in the mineral core holes are in units directly overlain by the Milligans Beds, hence the zone where these latter units are truncated by, and it communication with, the Milligans Beds should provide ideal trapping geometry for either structural or stratigraphic traps. As a consequence of this, any well targeted at closures on the Milligans Beds should be drilled through these deeper units. The Ningbing Limestone is present in EPA 126, south of Bonaparte Oils tenement, in the area of the Keep River 1 well. It attains considerable thickness, (in the order of 1025 metres) of which nearly 300 metres was reefal and of potential reservoir quality. Both platform atoll and pinnacle reef developments are present, much oil in Canada has been discovered in similar traps of a similar age. The area around the Keep River 1 well on the Pincombe Ridge, or its analogues in EPA 175, if present, would be ideal places to look for this style of trap and similar areas are likely to be present in EPA 175. R.A.Meaney &Associates November 2010

EPA 175

9. 9.1

PREVIOUS EXPLORATION Coal Exploration

The first exploration drilling undertaken in the onshore sector of the Bonaparte Basin, and in what is now EPA 175 in particular, was undertaken from 1906-1909 by the South Australian Mines Department. An appreciable amount of coal drilling was conducted in the Port Keats area. This drilling was instigated as a result of coal outcrops noticed in the Port Keats area and was aimed at providing energy and export income for the remote Northern Territory of South Australia. The SA Mines Department drilled approximately six coal bores around Port Keats, Cliff Head, Cape Ford, Anson Bay and Cape Hay where the coal is in outcrop. These bores, the deepest of which was approximately 230 m deep, failed to find coal seams of economic importance, and the search was abandoned, and the drilling ceased in 1909 when the coal seams were found to be thin and not continuous. These coal seams have been dated as of Upper Permian age. In 1965 and 1966, during the drilling of the Kulshill 1 and Kulshill 2 petroleum exploration wells, these coals and deeper Lower Permian aged coals were intersected. This re-ignited the search for coal and spurred a second round of coal exploration in the Port Keats area. Thiess Brothers Pty Limited commenced a drilling program for coal in 1967 which continued in 1968. The thinness and discontinuous nature of the coals resulted in the company surrendering the Coal Licence 172. They were followed in 1973 by Utah Development Company (Utah) in Coal Licence 173. The results of Utahs drilling were also very disappointing, thin, discontinuous coal seams. Utah soon surrendered their Coal Licence. The next coal drilling in the area of EPA 175 was conducted by CRA Exploration during 1983, when they undertook drilling in Coal Licence 1. The results that they obtained were the same as their predecessors and they too, soon relinquished the Coal Licence. After drilling a significant number of exploratory holes these companies found that the coals were thin, discontinuous and of no appreciable areal extent and concluded that the coals were contained within unconsolidated sediments and hence could not be mined, by either open cut or underground methods. In 1983 Western Mining Corporation Limited (WMC) obtained Coal Licence 2 in the Keep River area and undertook a literature search but then surrendered the Coal Licence, without undertaking drilling. Most coal drilling has been conducted in areas which have suffered significant erosion however coals of economic thicknesses may be present in the un-deformed synclinal areas, however this is considered to be most unlikely. The coals drilled are bituminous and highly volatile and as such, if present over an appreciable area, could be of interest in coal bed methane (CBM) drainage. Extensive drilling would have to be undertaken to evaluate the CBM potential of EPA 175. The potential for CBM is considered by the author to be negligible as the thickest coal seam, which does not appear to be widespread over the permit is approximately 2 feet thick. R.A.Meaney &Associates November 2010

EPA 175 EPA 175 does not appear hold any significant potential for coal production either in open cut nor underground mining methods. Hence there does not appear to be any appreciable CBM potential in the tenement.

9.2

Petroleum Exploration

Scientific exploration began in the onshore sector of the Bonaparte Basin in 1948 when the respected American Petroleum Geologist, Frank Reeves, looked at the Bonaparte Basin of the NT and WA for the Standard Oil-Vacuum Oil (Stanvac) consortium of Standard Oil of New Jersey, later known in Australia as Esso, then Exxon and the Vacuum Oil Company, formerly known as the Standard Oil Company of New York, and Mobil later. Reeves report was critical of the oil potential of the Bonaparte Basin and the Stanvac consortium did not continue with exploration in the basin. This was followed by the WA Geological Survey (WAGS), also in 1948, which undertook field mapping in the Ord and southern Bonaparte Basins in WA, close to the NT border. This was then followed up from 1949-1955 by a combined Bureau of Mineral Resources, Geology and Geophysics (BMR) and Commonwealth Scientific and Industrial Research Organization (CSIRO) effort which began field mapping, gravity data acquisition, stratigraphic drilling and sedimentological and lithological studies as part of their extensive Northern Australia Mapping Project. During the mid 1950s a Joint Venture group composed of Associated Australian Oilfields Limited (AAO) and Westralian Oil Limited (WOL) conducted further field mapping, gravity surveying and stratigraphic drilling in the Oil Permit (OP) 2 in the Spirit Hill area and in OP 3 in the area of the Keep River. This was followed in the late 1950s when Mines Administration Limited (Minad), the technical arm of AAO, and also the BMR acquired gravity data in the region mainly in the area to the south of Bonaparte Oils permit. Minad also conducted an aeromagnetic survey. The above data was subsequently used by Westralian Oil Limited to site the Spirit Hill 1 well, which was spudded in 1959. The company effectively deepened a water bore from which hydrocarbon indications had earlier been reported. It was suspended above the programmed total depth due to the arrival of the wet season. Seismic data acquired subsequently by Geosurveys Pty Limited shows that this well is many kilometres off the crest of the Spirit Hill Structure. In spite of its inappropriate location this well encountered good oil shows in the Upper Devonian Ningbing (=Spirit Hill) Limestone section. The location of all wells and seismic lines is shown in Encloure1n and Figure 6. The Spirit Hill Structure is located well south of Bonaparte Oils permit, south of the Weaber Gas Field in RL 1, close to the NT-WA border. However correlative rocks to the Ningbing Limestone may be present, adjacent to the Moyle fault, in the south of EPA 175, the underlying Cockatoo Limestone was intersected in Kulshill 1. This unit is thought to be present west of the Kulshill wells, further west and basin-ward. The location of this well and all other onshore wells located in the Bonaparte Basin, along with the near offshore wells is shown in Figures 1, and 6 and Enclosures 1 and 2. R.A.Meaney &Associates November 2010

EPA 175

The BMR, now Geoscience Australia, conducted studies on cores from Spirit Hill 1 taken down to 736 metres, the original total depth of this well. As a result of these studies it was recognized that the well had bottomed in Spirit Hill Limestone and that a much thicker Carboniferous section than was prognosed was present at the well site. Hence it was concluded that the prospective Spirit Hill Limestone was not fully tested at the well location. Oil Development N.L, later Alliance Oil Development N L (AOD) and subsequently Alliance Petroleum Limited (Alliance), farmed into OP 3, and acquired the Spirit Hill Seismic Survey in 1961. Alliance then deepened the Spirit Hill 1 well, in 1960, to 915 metres. Additional seismic data acquired by General Geophysical Company (Bahamas) in 1962 in their Spirit Hill Seismic Survey shows that the well location is approximately 4 kms off the crest of the Spirit Hill Structure. Later petrological studies indicated that the general section at Spirit Hill had low porosity and permeability. However these observations are negated by the fact that the well flowed water on a drillstem test, from the Spirit Hill Limestone (=Ningbing Limestone), hence some reservoir quality rocks are present. Oil shows were also recorded in the Milligans Beds in this well. Alliance, also farmed into WOLs WA onshore Bonaparte Basin acreage. This expanded consortium then drilled Bonaparte 1 in WA, in 1963. It was plugged and abandoned after encountering hydrocarbon shows, gas, in the Bonaparte Beds, which is equivalent to the combined Milligans Beds, Keep River Group of Early Carboniferous age and the Upper Devonian aged Ningbing Limestone and Cockatoo Formation. The shows are probably from the Milligans Beds. No drillstem tests are reported from this well, which drilled through 10,530 feet of section, most of which was Lower Carboniferous, with lesser amounts of Lower Permian. Seismic data, acquired after the drilling of Bonaparte 1 showed that the well was not a crestal test and the crest of the structure was subsequently tested by the Bonaparte 2 well, in 1964. This well flowed gas at the rate of 1.5 MMCFD, which was not sustained, from a drillstem test of a Carboniferous-aged sandstone. This rate in such a remote location, at that time, was considered to be sub-commercial and the well was plugged and abandoned. The AAO-WOL Joint Venture acquired geophysical data, both gravity and aeromagnetic surveys in the Port KeatsMoyle River area in 1959 and 1960, respectively. These surveys consisted of geological field work, both mapping and stratigraphic drilling. This is the first work done with any immediate relevance to the petroleum potential of the area of what is now EPA 175. It was followed by the Keep River Seismic Survey which was acquired in 1962 in the then OP 2. Following this Australian Aquitaine Petroleum Pty Limited farmed into OP 2 which was held by AAO and became the operator of the tenement. AAO retained an Over Riding Royalty Interest in OP 2. Aquitaine subsequently joined the WOL-Alliance Joint Venture exploring in OP 3 and in WA. Hence Aquitaine and Alliance was exploring in the entire onshore Bonaparte Basin, either side of the WA/NT border. The former company became operator for all tenements and acquired additional seismic data and also widely used gravity data to augment this seismic data in the selection of well sites. The company also utilized structural and stratigraphic data from the subsequent minerals exploration programs they, and others, conducted in the area. R.A.Meaney &Associates November 2010

EPA 175

The last seismic survey conducted by AAO as operator of the tenement was the Keep River Seismic Survey in the Keep River area south of EPA 175. The following year, 1963, Aquitaine acquired the Point Pearce Seismic Survey in what is now EPA 175. This survey, like most acquired by Aquitaine also involved the acquisition of gravity and magnetic data, given the frontier nature of the acreage. In 1964 Aquitaine conducted a shallow scout core drilling program south of the Port Keats area, in the Sugarloaf area. They also recorded the Legune Seismic and

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EPA 175 Gravity Survey immediately south of EPA 175 in the same year. The following year, 1965, the

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EPA 175

company recorded the Queens Channel Marine Seismic Survey in the territorial waters of Queens Channel, immediately south of EPA 175. During 1966 the Moyle River Seismic and Gravity Survey was recorded in the area of what is now EPA 175. During June 1965 Aquitaine spudded Kulshill 1 some 9 miles south of the Port Keats Mission. Drilling was suspended late in 1965 due to the wet season, and subsequent inaccessibility, and it was recommenced in May 1966. The well was designed to evaluate a heavily faulted structural trap, formed by deep seated salt tectonics, defined by a rather coarse grid of very poor quality, low fold seismic data. The well, which drilled 14,416 feet, reached total depth in sediments of the Upper Devonian Cockatoo Formation. It penetrated 185 feet of weathered post Paleozoic (Mesozoic) sandstone, 6000 feet of Lower Permian aged sediments, which were unconformably underlain by 6165 feet of Lower Carboniferous and finally 2076 feet of Upper Upper Devonian section. Aquitaine, from palynological, electric log and facies variation, divided the Lower Permian section into three formations, namely; The upper Sugarloaf Formation, with marine and deltaic genesis and composed of black shales and sandstones with minor coal. The Kulshill Formation of fluvioglacial units of greywackes, tillites and silicified sandstones. An unnamed basal formation of siltstone, calcareous sandstone and coquina. And the Lower Carboniferous section into: The Lower Carboniferous Tanmurra Formation of brackish water sedimentation with minor marine calcareous sandstones. The Lower Carboniferous Milligans Beds (=Milligans Formation) The Upper Devonian Cockatoo Limestone

The various operating companies in the onshore and onshore sectors of the basin have used various and differing stratigraphic nomenclature and the result is quite confusing. It is probably wise to use the nomenclature used by Aquitaine in and around Port Keats as shown in Figures 3 and 5 in the onshore section. Many good oil and gas shows were recorded in Lower Permian and Lower Carboniferous sections of Kulshill 1. Good gas only shows were reported from the below the top of the Tanmurra Formation. Most of these shows were in impervious section, and all drillstem tests of porous and permeable zones flowed salt water. At the completion of the 1965-1966 wet season drilling recommenced at Kulshill 1 and and when the well was plugged and abandoned the rig moved to, and commenced drilling at Kulshill R.A.Meaney &Associates November 2010

EPA 175

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EPA 175 2, some 12 miles south of Port Keats and 3 miles south of Kulshill 1. Kulshill 2 was sited in a structurally higher, but separate fault block, on the greater Kulshill Structure. The well reached total depth in of 6,432 feet in the Lower Carboniferous after drilling through Mesozoic sandstone and Lower Permian section. The objective of the well was to test the Tanmurra Formation at a structurally higher position than in Kulshill 1. Good oil and shows were noted in the impervious intervals of the Lower Permian to Lower Carboniferous Kulshill Group (=Weaber Group). However subsequent drillstem tests of the permeable and porous sections of the well, which exhibited shows, failed to flow hydrocarbons, only salt water. The next well drilled Moyle 1, a shallower well was a deliberate stratigraphic test to evaluate the hydrocarbon potential of the eastern portion of the basin, on the up-thrown side of the Moyle Fault. The well, with only with stratigraphic objectives, was spudded with a smaller rig in July 1966. This well evaluated the stratigraphic section between outcropping basement east of the seismically delineated Moyle Fault of the Cockatoo Fault System, east of the Kulshill Structure. The well site is sited west of the basin bordering Tom Turners Fault which separates the Proterozoic aged and highly mineralized and metamorphosed Pine Creek Geosyncline from the Bonaparte Basin. The well which drilled 1,695 feet of Lower Permian section reached total depth at 1767 feet in gabbro, crystalline basement. No indications of hydrocarbons are reported, not surprisingly, in this stratigraphic investigatory well. During 1966 Aquitaine acquired the Cape Hay-Cape Ford Marine Seismic Survey in NT territorial waters west of Port Keats. This was followed by the Oakes Creek Seismic Survey, a land survey acquired in the following year, 1967. During 1967 a detailed study of the geology of the south and southeast of the Bonaparte Basin was undertaken by Aquitaine utilizing their newly acquired geological and geophysical data. The Hyland Marine Seismic Survey was acquired in OP 2 and 3 by Western Geophysical Company of America (Western) for Aquitaine and the Keep River Reflection Seismic Survey was acquired south of EPA 175 for WOL. Aquitaine spudded Keep River 1 approximately 65 miles north of Kununurra, WA in September 1968. The well was commenced late because of the unseasonal early onset of heavy rain in the normally dry season. Procedures were taken to enable the drilling to continue during the wet season and the well was plugged and abandoned in March 1969. The well drilled through 1550 feet of fluvio-glacial deposits, the top most 140 feet of these being weathered fine grained sandstones overlying sandstones with minor silty and micro-conglomeratic inter-beds and thin seams of vitreous but friable coals. This was followed by 900 feet of weakly calcareous sandstones, with traces of pure limestone of the upper part of the Lower Carboniferous aged Tanmurra Formation, which unconformably underlies the Lower Permian. This was unconformably underlain by 7070 feet of Lower Carboniferous aged Milligan Beds. This was in turn unconformably underlained by 1050 feet of Lower Carboniferous Septimus Formation, which contained calcareous oolitic sandstones, often good reservoirs, it was then conformably underlain by 700 feet of Enga Formation (=Sandstone), a further 360 feet of unconformable Burt Range Formation and some 840 feet of an un-named formation of Lower CarboniferousUpper Devonian age.

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EPA 175 Some 3320 feet of Ningbing Limestone unconformably underlies the previous unit. And after drilling a further 113 feet of conformably underlying Upper Devonian Cockatoo Limestone the well reached total depth of 15,623 feet in this latter unit. The section becomes more calcareousdolomitic below the top of the Burt Range Formation. Many good gas shows were noted in the Lower Carboniferous section and several, associated with fractures, in the Upper Devonian. A total of eight drillstem tests were conducted in this well, which was open for up to six months. The best of these over a combined portion of part of the Milligans Beds, the Septimus Formation and part of Enga Formation flowed gas to surface at an initial rate of 3.0 MMCFD which after 8 hours decreased to 0.2 MMCFD. A second drillstem, test over an interval of the Milligans Beds, flowed gas at a smaller rate. Oil traces were also noted in cores from the Ningbing Limestone in this well. The diminishing flow rate mentioned above may indicate a reservoir of very limited areal extent, the generally accepted view. However the fact that the well was open for so long may indicate serious reservoir damage. It should be noted that economic basement to the sedimentary section of the Bonaparte Basin is the Antrim Plateau Volcanics (=Antrim Basalts). Volcanics, particularly basalt, weather to swelling clays rich in montmorillinite. Rocks with a similar provenance, the Stzelecki Formation in the Gippsland Basin of Victoria are very prone to reservoir damage, especially from fresh water based drilling fluids. In 1969 Atlantic Richfield Limited (Arco) the Australian affiliate of the United States major, Atlantic Richfield, one of the early explorers of the offshore Bonaparte drilled Lacrosse 1 in near shore waters of the Petrel Sub-basin. Poor reservoir development was encountered in the primary target of the well and it is thought that the trap was breached. However good oil shows were reported from this well. This was followed by the Lone Hill Seismic and Gravity acquired for Aquitaine in OP 162. A review of exploration results and the petroleum potential Aquitaines permits in the NT was undertaken during 1971. Arco one of the early explorers of the offshore Bonaparte drilled the Pelican Island 1 well in near offshore waters in the WA sector of the Petrel Sub-basin of the Bonaparte Basin in 1972. Both oil and gas shows are reported from this well, which appears to be breached by faulting. The reservoir section in this well was also poorly developed. In 1972 the Border Creek Land Seismic Survey was conducted south of EPA 175 by Aquitaine, who also recorded the Quinns Seismic Survey in 1974 as exploration activity began to slow in Australia. Aquitaine drilled the Kinmore 1 well in offshore permit NT/17P during July and August 1974. The Kinmore Prospect was a very large salt cored structure located approximately 32 kms offshore. The target of the well was what Aquitaine called the Greywacke Member of the Lower Permian aged Kulshill Formation. The well was deliberately sited to intersect the target zone several hundred metres down-dip of the crest of the structure as Aquitaine thought that the target interval was not present in the crestal location, as they thought the salt was within a kilometre of the sea-floor. No indications of hydrocarbons are recorded and the well was plugged and abandoned at a total depth of 3250 m in the Pre-Devonian rocks of the salt diapir core. The R.A.Meaney &Associates November 2010

EPA 175

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EPA 175 entire Lower Carboniferous section was considered by Aquitaine to be diapir sheath. Hence neither the Permian nor Lower Carboniferous intervals of the well were tested in structurally high, valid crestal locations. Following the encouraging drilling results encountered at Keep River 1, Lacrosse 1, and Pelican Island 1 and the disappointing results at Kinmore 1, Aquitaines attention was directed towards the area south of EPA 175 and away from the Port Keats area. Up until 1973, approximately 2,000 line kilometres of seismic data was acquired in the onshore sector of the basin. The location of this data is shown on Enclosures 1 and 2 and Figure 6. All of this data is of poor quality and much is unusable. In an effort to obtain improved structural definition, the operating companies acquired a substantial amount of gravity and aeromagnetic data as well as seismic data. It was found that the considerable thickness of Precambrian clastics and Cambrian volcanics greatly limited the effectiveness of the aeromagnetic data whereas surface conditions degraded seismic data quality. In line with world trends, little exploration occurred in the basin during the early to mid 1970s. Exploration picked up in the late 1970s as a result of the effects of the first oil price shock. Many analytical geochemical studies, including source richness and maturity, lithology, diagenesis, and sedimentological, were conducted, often by Aquitaines Technical Laboratory in France, in the late 1970s - early 1980s. Much of the Joint Ventures drilling in the mid 1980s was directed towards the WA portion of the onshore basin, where Ningbing 1 (1982), Skull 1 (1984) and Garimala 1 (1988) were drilled. However the very important Weaber 1 was drilled in the NT sector. Hydrocarbons are reported from the Skull 1 well and gas flows are reported from both Ningbing 1 and Garimala 1. In the former well gas was flared from the Milligans Beds and importantly from the Cockatoo Group in the latter. Indications of oil were also encountered in the Ningbing Limestone and Cockatoo Group in Ningbing 1. A significant amount of seismic recording, along with associated gravity data acquisition occurred in the early 1980s and a second wave of drilling began. The most important well drilled in the onshore of the basin, Weaber 1, was spudded in the NT portion of the basin in September 1982. This well exhibited good hydrocarbon shows in the Enga Sandstone. The operator felt that the section was tight and perhaps of limited lateral extent, given previous experience, and elected not to test these shows. Consequently the well was plugged and abandoned. Aquitaine also drilled the Ningbing 1 exploration well in the WA sector of the basin in 1982. Gas cut mud is reported from a drillstem test of the Ningbing Limestone and also from the Milligans Beds from this well, as are indications of oil. The next well drilled, Skull 1, also located in the WA sector of the basin in the WA sector of the basin. It was spudded by Aquitaine in 1984. Anecdotal hydrocarbon shows are also reported from this well. Western Mining Corporation Limited (WMC) spudded Turtle 1, a near offshore well in the WA sector of the Petrel Sub-basin of the Bonaparte Basin in 1984. Oil was recovered

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EPA 175 from a combined drillstem test of the Lower Permian aged Keyling and Kuriyippi Formations and the Lower Carboniferous aged Tanmurra and Milligans Formations. During the mid 1980s many mergers of companies occurred and Santos acquired Alliance and Aquitaine subsequently decided to withdraw from exploration in onshore Australia and operatorship of the onshore permits reverted to Alliance and by default to Santos. Eventually both companies were to be effectively taken over by Santos. Additional exploration was conducted when Santos recorded the Spirit Hills Seismic Survey to the south of EPA 175 in 1984 and Queensland Petroleum Pty Ltd drilled the Bulloo River 1 well south of EPA 175 in 1984 in the Proterozoic Victoria River Basin in an area of recorded accidental oil shows and a seep. The well is located beyond the edge of the Bonaparte Basin. The section penetrated had no porosity, nor permeability. Minor indications of methane, ethane and propane were observed on the gas detector during, however these are thought to have been released from shales during drilling. No Bonaparte Basin sequence was penetrated. This well was drilled on gravity data without seismic data near an early reported oil seep which was relocated and confirmed by a Minad geological party in the 1950s, hence it is an ambiguously sited test. The following year, 1985, Aquitaine, who had remained the operator in the offshore permits, drilled the Barnett 1 well in shallow near-shore waters of the Petrel Sub-basin. Oil shows were encountered in the well, which is known from subsequently acquired seismic data to be a non crestal and hence invalid structural test. The target zones the Tanmurra and Milligans Formation had poorly developed reservoir section. In the interim the Weaber 1 well had begun to leak gas and at the instigation of the NT Department of Minerals and Energy, Santos re-entered Weaber 1 in 1985 and conducted drillstem tests on gas saturated intervals, shown on the mud logs and electric logs. They obtained a combined gas flow of 4.5 MMCFD from the two hydrocarbon bearing sandstones in the Enga Sandstone, which had been recognized on a re-evaluation of electric logs. However well-bore damage occurred and the drill pipe had to be cemented into the well bore to secure the hole and the hole was again plugged and abandoned. During 1987 Santos recorded the Weaber Plains Seismic Survey around the sub-commercial Weaber Gas Field, south of Bonaparte Oils tenement. In the same year Santos also recorded the reconnaissance Pincombe Seismic Survey south of EPA 175 to locate and detail a prospect on the once emergent Pincombe Range, where it was thought that better quality oolitic reservoirs may be present. Two further wells were drilled in 1988 in the onshore sector of the basin. The first, Weaber 2, an appraisal well was located, with poor geophysical control, approximately 2.3 kms westnorthwest of Weaber 1 and was spudded by Santos but plugged and abandoned at a depth of 445m due to extreme hole damage. The rig was skidded some 125 metres north and Weaber 2A was spudded. The two hydrocarbon bearing sands in the Enga Sandstone were intersected low to prediction and were found to be water wet and of diminished reservoir quality and continuity.

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EPA 175 Gas shows were encountered in the Milligans Formation, which were drillstem tested. The first test resulted in tool plugging whilst the second test flowed gas to surface at the non-commercial rate of 0.34 MMCFD. No hydrocarbon shows were encountered in the primary targets in the Enga Sandstone, which were intersected some 70 and 50 metres respectively, below the lowest known gas saturated section in the discovery well. The second well drilled onshore in 1988 was Garimala 1, it was also spudded by Santos but in the WA sector of the basin. . Garimala 1 flowed gas from a drillstem test of the Upper Devonian Cockatoo Limestone at non-commercial rates. WMC drilled the Turtle 2 appraisal well in 1989 and the well produced good oil shows and flowed oil at the rate of 900 bopd from drillstem tests of the Keyling and Milligans Formations. These units, and the Kuriyippi and Tanmurra Formations as well, had good oil shows in Turtle 1. Aquitaine, who had retained their offshore acreage, drilled the Barnett 2 well in a more crestal location on the Barnett Structure in November 1989. The primary target, the Milligans Formation, which produced oil flows in Turtle 2, was drillstem tested and gas at the noncommercial rate of 0.09 MMCFD was flowed. Three drillstem tests were also combined conducted on zones with good oil shows in the Lower Permian aged Kuriyippi Formation of the Kulshill Group. One of these tested flowed water but two others flowed oil at rates of 752 and 921 barrels of oil per day (BOPD).

By now Santos had acquired Aquitaine and they then drilled the Barnett 3 well some 300 metres southwest of the Barnett 1 discovery well. The well, which was spudded in August 1990, was designed to appraise the hydrocarbon recoveries obtained in the Barnett 1 and Barnett 2 wells and the oil flows from Barnett 2. The primary target the Kuriyippi Formation was penetrated low to prediction and the reservoir was poorly developed. Good oil fluorescence and brown oil staining, now considered to be residual or dead oil, was observed in cuttings of the Keyling Formation whilst poor oil shows are also recorded from the Early Permian Fossil Head Formation of the Port Keats Group. No resistivity anomalies were noted on the electric logs and comprehensive pressure data indicated a water gradient, hence the well was plugged without drillstem testing or Formation Interval Testing (FIT). In 1992 the Broken Hill Propriety Limited (BHPP) led consortium drilled the Billawock 1 well in September 1992 approximately 3 kms offshore from the NT coast, just beyond the NT territorial limit, off Cape Hay. The well evaluated a large rollover anticline on the downthrown side of the Moyle Fault, a basin margin fault. The primary target of this well was the Early Permian Treachery Shale with secondary targets in the overlying and underlying Keyling and Kuriyippi Formations, respectively. All targets are members of the Early PermianLate Carboniferous Kulshill Formation. Very good reservoir development was found in the target zones and good sealing shales were encountered in the Keyling and Kuriyippi Formations. The expected source rock, those of the Kulshill Group, which were established as mature at the Turtle and Barnett oil discoveries further south, appear to be immature in the vicinity of the Billawock Structure, where they are more shallowly buried. The older source rocks of the Weaber Group, the Tanmurra and Milligans Formations, which are known to be mature onshore around the Port Keats, Keep River and Weaber Plains areas were not present at the well location R.A.Meaney &Associates November 2010

EPA 175 and are known to pinch-out southwest of Billawock 1. Hence the Billawock was starved of a hydrocarbon charge and it seems that the anticlinal trend to the south west of the Billawock Structure acted as a barrier to hydrocarbon migration from the more remote major hydrocarbon generative kitchen in the central Petrel Sub-basin. It seems that the Billawock 1 well tested a valid structural prospect which was shielded from charging by an oil pulse. Minor oil cut fluorescence was recorded in the Kuriyippi, Treachery (Shale) and Fossil Head Formations. As wire line log and pressure data analysis indicated that no movable hydrocarbons were present the well was plugged and abandoned without testing. The failure of this well has no real bearing on the prospectivity of EPA 175 as the best source rock interval is not present in the area of the Billawock Structure. Also as shown by Figure 8, a structural elements map prepared by BHPP. This drawing illustrates that the Billawock Structure is widely separated from the major depocentre of the Petrel Sub-basin in the head of the Joseph Bonaparte Gulf. Furthermore it is separated by two regional anticlinal trends from this main depocentre which has sourced the two major discovered, but as yet undeveloped, gas fields in the Southern Bonaparte Basin, Petrel and Tern. Both of these fields host gas in the Permian aged Hyland Bay Formation. The above mentioned kitchen has also sourced the recently developed Blacktip gas/condensate accumulation. Reprocessing of the Spirit Hill and Weaber Plains Seismic Surveys data was undertaken in 1993 by Santos. A Retention Licence, RL 1, was granted over the Weaber Gas Field and subsequently Weaber 3 was spudded by Capital Energy N.L.in November 1994. The well was located 1.5 kms north of Weaber 1 and targeted the gas saturated sands of the Enga Sandstone. Good gas shows were noted on the mud logs through these sands, however the well suffered hole damage and the gas productive section at Weaber 1 could not be logged with wire line tools. But the mud logs indicated gas saturation. The above-mentioned caving and other difficulties precluded the running of a drill stem test and the hole was plugged and abandoned. The encountered reservoir section was of much poorer quality than at Weaber 1 & 2/2A. The reservoir at Weaber 1 is of the best quality. No oil indications were noted in the cuttings. The long interval of time for which the hole was open, the deterioration of the mud, which became heavily over-balanced, and the supply problems caused by the rains of the wet season resulted in the well being plugged and abandoned. Gas shows which were unable to be tested occurred in this well, Weaber 3. The Japanese company Teikoku Oil (Bonaparte Gulf) Co., Limited drilled two wells in 1994 in near shore waters of Queens Channel in what is now EPA 136. The first of these wells, Kingfisher 1, was plugged and abandoned, without testing in August 1994. The Lower Permian Kuriyippi and Point Spring Formations exhibited showed poor oil shows. Better shows, mainly gas, were present in the Milligans and Bonaparte (=Ningbing Limestone) Formations. The Kingfisher Structure is a salt induced structure and its failure to host hydrocarbons may be explained, if the formation of the structure post-dates the migration of hydrocarbons, as the well tested the crest of the structure.

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EPA 175

R.A.Meaney &Associates November 2010

EPA 175 The companys second well, Sunbird 1, was also plugged and abandoned without testing in October 1994. Minor hydrocarbon shows are reported from the Kuriyippi Formation with better shows occurring in the Port Spring Formation. Some minor oil shows are recorded in the Tanmurra Formation and some moderate gas shows were present within the lower Milligans Formation. The Sunbird Structure is a fault related drape structure. Its failure may be due to breaching of the trap. During the mid 1990s Amity also extensively explored in the WA sector of the basin, drilling the Waggon Creek 1, Waggon Creek 1A, Ningbing 2 and Vienta 1 wells. Amity spudded the Waggon Creek 1 well in the WA sector of the basin in 1995 and the company successfully flowed gas from a drillstem test of the Milligans Formation. Drillstem tests of two intervals in the upper Milligans Formation flowed gas at the rates of 1.34 and 1.0 MMCFD, respectively and some oil was recovered. Due logistical problems, the lower Milligans Formation and Langfield Group were not penetrated in Waggon Creek 1 and the rig was skidded to the Waggon Creek 1A location some 60 metres northwest of the discovery well in 1996. The major aim of this deeper well was to investigate the deeper lower Milligans Formation and Langfield Group, not penetrated in Waggon Creek 1 as well as investigating the underlying Ningbing and Cockatoo Groups. Another aim was to appraise the hydrocarbon accumulation discovered in the upper Milligans Formation in Waggon Creek 1. No hydrocarbon indications were noted in the upper Milligans Formation. Hydrocarbon indications in the Burt Range Formation were drillstem tested and gas flowed to surface at a rate too small to measure. Section as well as potential reservoirs appear to have been lost, due to faulting, between these two wells. Amity then drilled an additional well on the Ningbing Structure when they spudded Ningbing 2 near to Ningbing 1 in 1996. Like many wells in the basin Ningbing 2 encountered hole problems, as well as many intervals of elevated gas readings. Six drill stem tests were attempted of which three were mechanically successful, two of these, over intervals in the Milligans Formation, flowed gas to the surface at a rate too small to measure. Another two made recoveries of gas cut water. The last exploration well drilled in the NT, Pincombe 1, was also operated by Amity. It was located in the area of EPA 126, south of EPA 175, northwest of Spirit Hill 1 and southwest of the Weaber Gas Field. The well which was located almost on the WA border was drilled in 1996 on the Pincombe Ridge and was located by seismic mapping. The targets of the well were the Cockatoo Group and overlying Langfield Group. It was sited down-dip of oil staining in mineral holes in the Langfield Group and up-dip of the Weaber Gas Field. No significant hydrocarbon shows were encountered, nor was any significant reservoir found in the Cockatoo and Ningbing Groups. Log analysis indicates some low level oil saturation in sandstones of the Ningbing Group, in very tight rocks. A drill stem test of an interval within the Ningbing Group recovered a near full string of fresh water indicating possible flushing of the rocks by meteoric water, if the trap was valid. However the result of this test also indicates the presence of some reservoir R.A.Meaney &Associates November 2010

EPA 175 quality rock. The well was plugged and abandoned after the target zone was found to be water wet and the structure is thought to be breached. Amity then recorded the Weaber Plains Seismic Survey south of EPA 175 in 1996 and Amity reprocessed the poor quality seismic data of the Weaber Plains Seismic Survey in 1997. They then, in 1997, spudded the Weaber 4 well, approximately 20 metres north of the Weaber 1 discovery well. The objective of this well was to conducted long term production tests of the gas saturated sandstone, which flowed gas at Weaber 1 after the re-entry and testing of the discovery well, which had to abandoned due to hole damage. The discovery well could not be production tested due to well damage. The Enga Sandstones targets of the well were found to be tight and several drillstem tests were attempted but unfortunately most were unsuccessful due to packer failure, eventually a successful test was conducted, unfortunately no hydrocarbons were recovered. The section was found to be tight however, surprizingly, the well was cased and suspended as a future producer. The Milligans Beds were also unsuccessfully tested. . The Weaber 5 appraisal well was drilled 2.3 kilometres northeast of the discovery well in October 1998 to test to appraise the northern extent of the sub-commercial Weaber Gas Field. The well was plugged and abandoned after a drillstem test of the upper Enga Formation sand flowed gas to surface at a rate too small to measure. The deeper gas saturated sandstone at Weaber 1 was not developed at Weaber 5. The well was plugged and abandoned. Reservoir quality was inferior to that at the discovery well. In the same year Amity spudded the Vienta 1, in 1998 in the WA sector of the basin. This remains the last exploration drilled in the onshore sector of the basin. This well flowed gas from a drillstem test of an interval in the Early Carboniferous Langfield Group. The objective of this well was to test a different package of sandstones to that present in Waggon Creek 1/1A. Not a lot of sand was intersected and much over-pressuring was encountered, as well as high gas detector readings. Two drillstem tests were conducted on his well, the first in the upper Milligans Formation, which flowed gas to the surface at a rate too small to measure. The second, over an interval of the deeper Enga Sandstone, which flowed gas to surface in 5 minutes at an initial rate of 0.26 MMCFD which declined to 0.17 MMCFD, a non-commercial rate. Amity held the view that hydrocarbons were trapped in the Waggon Creek Embayment, of WA, stratigraphically, as evidenced by the hydrocarbon indications at Ningbing 1, Ningbing 2, Waggon Creek 1/1A and Vienta 1. Following the drilling of the Weaber appraisal wells and Vienta 1 onshore exploration ceased and all exploration in the basin was conducted in the far offshore sector of the basin. The offshore discovery with the most relevance to onshore exploration in general, and EPA 175 in particular, was made at Blacktip 1 in offshore waters in the WA sector of the Petrel Sub-basin. This discovery, which was successfully tested by Woodside Offshore Petroleum (Woodside), flowed gas at a commercial rate from the Keyling Formation. The gross gas column height in the Keyling Formation was 339 metres and a smaller accumulation in the Triassic Mount Goodwin R.A.Meaney &Associates November 2010

EPA 175 Formation has a gross column height of 20 metres. Woodside later sold their interest in the field to the Italian major ENI, who recently developed the field with a gas pipeline to the AmadeusDarwin gas trunk line, the connection spur runs through EPA 175 and the gas plant at Wadeye and the Wadeye offshore condensate loading facility. ENI drilled the Blacktip North 1 well in 2008 which was plugged and abandoned. Recently released reserves figures indicate that the Blacktip Gas- Condensate Field holds in place gas reserves of 1.14 trillion cubic feet of gas (TCF) and associated condensate reserves of 1.9 MMBBLS. Hence the infra-structure for oil and gas development is present in Bonaparte Oils acreage. And many oil and gas shows are recorded as are a significant number of oil and gas flows. One developed and several, about to be developed fields, are located offshore of the tenement. A sub-commercial gas field, the Weaber Gas Field has been found onshore, south of the tenement.

10.

UNTESTED PLAYS

Many untested plays are present in Bonaparte Oils acreage and many more plays have not been definitively tested. The former include: Structural traps down dip of the basin margin and the oil stained shallow mineral drill holes. Statigraphic traps down dip of the basin margin and the oil stained mineral drill holes Composite structural/stratigraphic traps down dip of the basin margin and the oil stained mineral drill holes Dolomitic and/or oolitic calcareous sandstones with increased porosity and permeability and consequently better reservoir quality Salt diapiric structures in the southwest of EPA 175 Atoll reefs along any postulated once emergent high Pinnacle reefs adjacent to any postulated once emergent high

The existence of the diapiric structures is established in the area around Port Keats and the nearest of these to the axial trace of the Petrel Sub-basin should be tested. Such a possible structure, which needs further seismic delineation, has been located in the southwest of the tenement. It would be wise to test both the crest and the flanks of any salt diapiric structure to test for pre and/or syn and post depositional hydrocarbon migration and entrapment, respectively. It is possible that structures which have been emergent, which have reefal limestones or oolitic and/or calcareous sandstones, like those in outcrop in the Burt Basin or in the subsurface in the Keep River area may be present in EPA 175. This type of play will be more deeply buried in R.A.Meaney &Associates November 2010

EPA 175 EPA 175 than in and around the Burt Range Syncline near the basins southeastern margin. It is quite likely that with further exploration drilling and improved seismic acquisition, other plays will be identified, as the onshore sector of the basin is at a very immature stage of exploration. Much of the drilling done to date in the NT has been aimed at large structures in the Petrel Subbasin, which has a finer grained section and consequently less reservoir potential. Post mortems conducted on these wells indicate that most are several kilometres off the crest of the structure and as such are not definitive tests of the structure, nor of the play. These inadequately tested plays include: Structural traps within the Petrel Sub-basin beneath the Bonaparte and Milligans Beds Fault bound traps within the Petrel Sub-basin beneath the Bonaparte and Milligans Beds Fracture or dolomitically enhanced porosity in the Ningbing Limestone Oolitic reservoirs on old emergent highs Calcareous sandstone reservoirs on old emergent highs Salt induced structures

Valid crestal tests of the prospects need to be drilled to exhaustively evaluate the plays, this will require the acquisition of seismic data of markedly improved quality to delineate prospects. Whilst no seismically defined are present in the permit several plays namely fault dependent structural traps and salt generated traps have been identified. One of the former Lead Alpha is shown in Figure 7. An indicative possible resource determined for this lead using representative parameters and the area of fault dependent closure. The large lead, if confirmed by additional seismic acquisition, could contain the following possible resources:OIL (in place) 248 MMBBLS GAS (in place) 2.6 TCF

OIL (recoverable) 157 MMBBLS Representative Parameters:Area of fault dependent closure Height of net effective hydrocarbon column Porosity Oil saturation Gas saturation Oil Recovery Factor R.A.Meaney &Associates November 2010 78 km2 10 m 0.2 0.65 0.85 0.45

GAS (recoverable) 2.2 TCF Conversion Factors:Metres3 to Feet3 x 3.28 Metres3to barrels x 6.29

EPA 175 Gas Recovery Factor Trap Geometry Factor Formation Volume Factor 0.85 0.66 0.83

There are several leads of this style and of similar magnitude, which have been identified on old seismic data by Aquitaine. The salt cored structures around Wadeye are a similar areal extent, but could host larger net effective hydrocarbon columns, hence they could hold even larger possible hydrocarbon resources. 11. RECOMMENDATIONS

Whilst both oil and gas shows and gas recoveries have been made in the onshore sector of the Bonaparte Basin, it is view of the author that the basin edge is oil prone. This is empirically confirmed by the large number of oil, often residual, shows in shallow mineral bores. This indicates that a late oil charge has reached the basin margin. The oil recoveries are matched to deeper rich and mature shales in the offshore sector of the basin. Hence it is migrated oil. Furthermore shallow source rocks are in the oil window onshore. Hence the prime recommendation of this report is that the emphasis of exploration in Bonaparte Oils tenement be re-directed towards oil rather than gas. This is because oil is: More profitable More quickly developed The production costs are less Given its expected location near the basins edge and at relatively shallow depths, the drilling costs will be cheaper

No oil prospects that are ready to be drilled have been identified within EPA 175, although several leads have been recognized by Aquitaine, a previous operator and confirmed by Petroconsultants and the author. These leads are of a diapiric genesis and others are fault dependent closures adjacent to the Moyle Fault. The locations of these leads are shown on a combined play concepts, structural elements and seismic and well data base map shown as Enclosure 2. All those leads require seismic delineation. Since the development of the Blacktip Gas Field the economics of a gas discovery have improved markedly. Hence both oil and/or gas discoveries in EPA 175 could be speedily developed in the tenement. It is strongly recommended that drilling commence near the Moyle Fault and regardless of the outcome of such a test, drilling should then proceed in a basin-ward direction, to the west southwest and south to test intact traps within the Cockatoo, Langfield and Weaber Groups beneath the basal seals of the Milligans Group as well as in the shallower Kulshill Group. The most intact traps in the more basin-ward portion of the Petrel Sub-basin, adjacent to the coast, which appear to be more gas prone, are likely to be over or flanking salt diapirs. They may also be the largest. A modest gas discovery would be economic in these permits given their nearness to gas markets in Darwin and the connection to the Amadeus-Darwin gas trunk line to Darwin. Diapiric structures should be tested in both crestal and flank locations for a complete R.A.Meaney &Associates November 2010

EPA 175 evaluation of the structures potential and the uncertainty in knowledge of the time of hydrocarbon migration in the Petrel Sub-basin. For smaller gas discoveries consideration should be given to the compression and liquefaction of gas for markets in Darwin, Kununurra, Katherine and Wyndham. As a consequence of the known presence of salt tectonics it is recommended that modern regional gravity data be acquired in the north of EPA 175 to evaluate the area for presence of salt. If salt is indicated by such a survey it should be followed up by regional seismic recording to locate and then to define a trap. Fault bound traps are also likely to be present in this area which would also be identified by seismic mapping. These too should also be pursued. It is also recommended that an intensive experimental recording program be done before any new seismic acquisition is undertaken to improve data quality. This should include the use of water spraying trucks on the black soil plains to improve ground coupling. On the rocky outcrops areal receiver arrays and standing vibroseis source sweeps should be tested as to their effect of getting more energy into the ground. Seismic line placement should be biased towards the black soil plains, as the seismic acquisition problem should be more readily solvable there. Any seismic data recorded should be biased towards the dip direction, northwest-southeast, to maximize resolution. Some perpendicular strike lines should also be recorded to tie the lines together. It is the authors opinion that damage has been done to the reservoirs during drilling. Damage was evident in several of the wells in the Weaber Field. To maximize reservoir deliverability it is recommended that any future wells be drilled with either air or brine as the drilling fluid. This may overcome the declining gas flows encountered in many of the wells in the area. The reservoirs may be composed of volcanoclastic material which is hydrophilic and which swells in the presence of fresh water, reducing both porosity and permeability and hence reservoir performance. The extensive Antrim Plateau basalts are the likely provenance of any volcanoclastic material. 12 RISKS

No hydrocarbon exploration is without risk, even though scientific methods are used to reduce risk, it still exists. The sub-surface of the Earth is variable due to variances in the natural processes which control sedimentation and tectonic events. The main risks to exploration success are the existence of a trap, the presence of mature source rocks, the presence of a reservoir and the presence of a seal and the presence of conduits from the mature hydrocarbon generative kitchens to the shallower intact traps, with both reservoirs and seals. The risk on the existence of traps in EPA 175 is low, as fault dependent traps have been recognized on seismic data, as have diapiric structures. The risk on sealing units is also low in EPA 175, as previous drilling has shown an inter-bedded section with good reservoir development juxtaposed against impervious sealing shales. As much trans-current (wrenching or lateral) movement has been established on the faults present, it is expected that fault gouge will R.A.Meaney &Associates November 2010

EPA 175 seal fault dependent structural traps. Empirical evidence of shallow oil proves the connection of the hydrocarbon kitchens to the conduit carrier beds. The presence of reservoir units has been confirmed empirically and analytically by laboratory studies. The risk on mature source rocks does not exist, given the results of analytical studies and more importantly the intersection of hydrocarbons in many petroleum exploration wells and even in shallow mineral wells. The major risk to exploration is the timing of the formation of salt induced, diapiric traps, this can be reduced by drilling the top and flanks of salt induced structures. All in all the risks are considered moderate in EPA 175 but the sites of test wells must be positioned with modern, good quality, high resolution seismic data.

13

CONCLUSIONS

The major conclusion of this report is that Bonaparte Oils tenement is quite prospective for both oil and gas. It appears that Gussows Theorem is operational in the onshore sector of the basin in that oil has been driven to the basin edge by later generated hot, dry gas. This being the case it makes the areas fringing the basin edge prospective for oil, whilst the deeper more basin-ward sector to the north, deeper in the Petrel Sub-basin, appears to be more gas prone. There are several untested plays, which warrant evaluation, present within the tenement, west of the Moyle Fault, near the basin edge and out to the coast. These plays include atoll and pinnacle reefs and dolomitic, oolitic and/or calcareous sandstone targets and stratigraphic pinch outs. However the main untested plays are structural targets within the Kulshill Group, Weaber Group, and the Langfield, Ningbing and Cockatoo Groups of the Bonaparte Formation, beneath the seals of the basal shales of the Milligans Beds. This nomenclature is from the BHPP Southern Bonaparte Stratigraphic Column as shown in Figure 5. The stratigraphy of the onshore sector of the basin is confusing and requires detailed study and simplification. Furthermore, most, if not all, of the existing tests do not appear to be in valid crestal positions, hence they are not definitive. These inappropriately sited wells may be giving an inaccurate and adverse indication of the reservoir deliverability of the area. It is imperative that any structural trap be tested in a crestal location. This will identify any hydrocarbon column if it is present and has been emplaced after the creation of the trap, or if it has been re-migrated due to later tectonics. This crestal location will also improve and sustain the flow rates from any drillstem test likely to be conducted. It is recommended that for prospects of a salt tectonic genesis, that a second down the flank test be drilled to fully search for any entrapped hydrocarbon column regardless of the time of emplacement of the hydrocarbon charge. Such a test will test for a late or post trap formation oil charge. An effort needs to be made to improve the resolution of any seismic data to be acquired. This should be readily achievable and should result ultimately in better and more reliable sub- surface R.A.Meaney &Associates November 2010

EPA 175 mapping. The outcome of this will be the drilling of more robust and definitive plays and prospects. A review of drilling fluids to be used in future wells should be undertaken and the use of air or brine as a drilling fluid should be considered. This should alleviate reservoir damage whilst drilling. It should also reduce the chance of masking of hydrocarbon shows. Exploration should be directed towards oil as it is more profitable and more readily able to be developed. This means that activity should be concentrated in the southwest of the block, west of the Moyle Fault. Several fault dependent leads and several salt generated leads have been identified by previous operators and confirmed by the author A lead which was identified by earlier operators, Lead Alpha, should be delineated by modern high resolution seismic data, This combined structural, fault-dependent test will be a good evaluation for oil entrapment near the basin margin. Seismic delineation of leads previously identified by Aquitaine will be required before any drilling can be undertaken. It will be required for both diapiric and fault bound and fault dependent structural closures. These are the major recognized plays within EPA 175. In due course, a search should be made in the north of EPA175 for the presence of additional salt and diapiric structuring present on the Moyle Platform of the Petrel Sub-basin. Large structures may be present, however they are likely to contain gas. Even a modest gas discovery should be economic in this area, given the pipeline connection to Darwin and the export facilities. Several potential markets have been identified, such as the Alumina Plant at Nhulunbuy. Gas could be compressed onsite and transported by road to other smaller users. Oil could be exported from Wadeye or refined on-site for sale as diesel in northern Australia. Even a modest discovery of oil could be readily exported or transported to the southern refineries or refined in a modular in-field simple distillate refinery, such as those used at the Eromanga and Inland Oil Fields in Queensland, for sale in northern Australia.

14

DECLARATIONS

Sources of Information Data on Bonaparte Oils onshore Bonaparte Basin acreage was obtained from the open file data held in the Northern Territory Department of Mines and Energy Library and the Departments website. Data was also accessed on the website of the WA Department of Industry and Resources, as were websites of various operating companies in the WA and NT onshore and offshore sectors of the Petrel Sub-basin of the Bonaparte Basin and the Principal of Bonaparte Basin Oil Limited, Mr Rodney Illingworth. It was augmented by knowledge in the possession of the author. It was supplemented with public domain data as listed in the Bibliography (see below). Coal and mineral exploration data was also utilized. Previous Independent Geological Reports R.A.Meaney &Associates November 2010

EPA 175

This is the first independent report prepared for Bonaparte Oil Limited on their petroleum exploration tenement, EPA 175, Northern Territory. The author referred to a previous report that he prepared for another operator of onshore Bonaparte Basin in the Northern Territory. Limitations and risk The author has relied on the sources indicated above. A draft of this Report was supplied to Bonaparte Oil Limited for comment regarding any errors of fact. Title Verification of title was not within the brief of Mapcourt Pty Ltd, trading as R.A. Meaney and Associates, in relation to this Report. Inspection As is usual for exploration permits the author has not undertaken an inspection of the properties dealt with in this Report. Comment It is the authors view that the proposed programme, to explore for and develop conventional hydrocarbon resources in Bonaparte Oil Limiteds Bonaparte Basin acreage, as outlined in this report, is soundly based on the results of previous exploration, studies by the company and the NT and WA Departments of Mines and Energy, and Industry and Resources respectively, as well as the Geological Surveys of the NT and WA and other nearby and earlier operators in the basin. It is also based on recent developments in the establishment of infra-structure used in the transmission of hydrocarbons, both liquid and gaseous and the subsequent sale and export of them. The author thinks that the proposed project is sound, appropriate and reasonable. Limitations and risk In preparing this Report the author has relied on the sources indicated above. A draft of this Report was supplied to Bonaparte Oil for comment regarding any errors of fact. Exploration for and development of hydrocarbons is inherently speculative. There is, as yet, no direct method for determining the presence of hydrocarbons prior to drilling of an exploration well. There is always the risk that any potential trap may not contain hydrocarbons by virtue of inappropriately located or timed hydrocarbon generation or migration, or due to ineffective seal or later disruption of the trap. A potential trap may also contain non-commercial volumes due to adverse reservoir conditions or inadequate charge of hydrocarbons. In this Report discussion of potential traps, including structures, features and culminations, and of related potential hydrocarbon volumes, should not be taken to imply that a commercial accumulation is known to exist. R.A.Meaney &Associates November 2010

EPA 175

Independence Mapcourt Pty Ltd is not operating under an Australian financial services license in providing this Report. A turnkey figure of $12,500 (exclusive of GST) is all the remuneration that Mapcourt Pty Ltd is to receive in providing this Report. Neither Mapcourt Pty Ltd nor any of its directors, employees or Associates has any beneficial interest in Bonaparte Oil Limited, nor in the permit which is the subject of this Report, nor in any adjacent permits. Conformity This report has been prepared to conform to the requirements of the Australian Securities and Investments Commission Policy 75 (Independent expert reports to shareholders) and Practice Note 42 (Independence of Experts Reports) and 43 (Valuation Reports and Profit Forecasts) as applicable. Date of report This report is dated November 30th 2010. Consent Mapcourt Pty. Ltd. consents to the issue of this Independent Geologists Report in the form and context in which it is intended. Qualifications Roger Meaney, Associate Consultant Petroleum Geologist, graduated from LaTrobe University with a B.Sc. (Honours) in Physics and a Diploma of Education in 1973.He later completed the requirements for a B.Sc. in Geology from the same institution, part time. He has more than 31 years experience in oil and gas exploration. He was employed as a Petroleum Geophysicist by Esso Australia Limited, AAR Limited and Santos Limited and worked in all facets of hydrocarbon exploration and production. He has extensive technical experience in both the onshore and offshore sectors of the industry in Australia and some in the United States of America, Canada and Papua New Guinea, Indonesia, Burma and Thailand and in management. Roger also has experience in the coal bed methane drainage industry, as well as knowledge of underground coal gasification and gas to liquids synthesis. He is a member of the Society of Exploration Geophysicists and of the Petroleum Exploration Society of Australia, and is subject to the code of ethics of these bodies. Roger has completed several Independent Geologist Reports for Australian companies in accordance with the R.A.Meaney &Associates November 2010

EPA 175 requirements of the Australian Stock Exchange. Roger is a past President and past Vice President of the Queensland Petroleum Exploration Society (QUPEX), Australias oldest petroleum industry body.

---------(Signed)-----------R.A. Meaney B.Sc. (Hon), Dip. Ed., MSEG, MPESA

. 15 BIBLIOGRAPHY Weaber Plains (1996) Seismic Survey EP 66 Onshore Bonaparte Basin Spirit Hills Northern Territory Field Acquisition and Operations Report. Report to Amity Oil Limited by Geosystems Pty. Ltd. July 1996 (PR19970003) 1995 Sandy Creek Seismic Survey EP 66 (Field Supervision Report). Report to Amity Oil Limited by Geosystems Pty. Ltd. October 1996 (PR19960003) Seismic Data Processing Report 1995 Sandy Creek Seismic Survey EP 66 N.T Report to Amity Oil Limited by Robertson Research. (PR19960003E) Final Survey Data Sandy Creek Seismic Survey Bonaparte Basin EP 66. Report to Geosystems Pty. Ltd by Dynamic Satellite Surveys. 1997 Spike Seismic Survey EP 66 and RL 1 Northern Territory Field Acquisition and Operations Report. Report to Amity Oil Limited by Terracorp Pty Ltd October 1997. (PR/19980056) Seismic Data Processing Report 1996 Waggon Creek and Weaber Plains Seismic Surveys. Report to Amity Oil Ltd by Robertson Research. (PR19970003B) Final Operations Report on 1996 Waggon Creek and Weaber Plains Seismic Surveys EP 386(WA) AND EP 66 (NT) Report to Amity Oil Ltd by Geosystems Pty. Ltd. (PR19970003A) Weaber 5 Well Completion Report compiled by Greg Irwin November1998. Report to the NT Department of Mines and Energy by Amity Oil Ltd. (PR19990002) Annual Report EP 32 May 2 1992 - May 1 1993-Teikoku Oil (Bonaparte Gulf) Co. Ltd Combined exploration in EPs 32 and 57. Report to NT Department of Mines and Energy by Teikoku Oil (Bonaparte Gulf) Co. Ltd (PR19930126). Final Report Offshore Navigation (Australia) Pty Ltd, Project 1626M. Report to Halliburton Geophysical Services Inc .and Santos Limited Western Australia December 1988. The Hydrocarbon Potential of Exploration Permit (EP) 3 Southeast Bonaparte Basin Northern Territory. Report to Barbara Investments Pty. Ltd. By R W Fisher and Associates May 1987. (PR19870036) Farmin Opportunity EP 126 Western Australia, EP 352 Western Australia and EP 31 Northern Territory Bonaparte Basin. February 1991. (PR19910012)

R.A.Meaney &Associates November 2010

EPA 175 Petroleum Prospects of Bonaparte Gulf Basin North West Australia. Leo W Stach MSc Consulting Petroleum Geologist. May 30th 1958. (PR19580002) The Ningbing - Burt Range Seismograph Survey Part 2 Oil Permit (OP) 3 Northern Territory. January 1964. Report to Alliance Oil Development Australia N.L by United Geophysical Corporation Exploration Permit 3 Final Annual Report Year Ended May 15th 1989 year Four of First Term. (PR19890033) Final Report on the geology of Northern Territory EP 31 Onshore Bonaparte Gulf Basin Surface and Subsurface Mapping of Southern Portion of OP 186, Northern Territory. December 1986 Internal Santos Limited Report compiled by M Majedi.(PR19850061) Hydrographic Survey and Sea Bed Investigation Timor Sea North West Australia. July 1967 Report to Arco Limited by Australian Hydrographic Services Pty. Ltd.(PR 67/08) Geological and Geophysical Report on the Keep River Area Bonaparte Gulf Basin1955.Mines Administration, 1955. (PR19540002) Report on the southern portion of Westralian Oil Limiteds permit area Bonaparte Gulf Basin. (PR19550002) Report on the Keep River Party 1956. R. J. Allen, Mines Administration, 1956 (PR19560009) Report on Exploration and Geology within Permit 3 Northern Territory during 1956. E.D. Utting, Westralian Oil Limited 1956.(PR19560009). Gravity Survey Burt Range Sub-basin Northern Territory. J. E. Burbury, Mines Administration Pty Ltd 1957. (PR19570003) Report on Plane-tabled areas in Bonaparte Permit 3N.T. J. Rade, Westralian Oil Limited. PR19570005) Regional Gravity Survey Bonaparte Gulf Basin North-western Australia. 1957. J.E.Burbury, Minad (PR19570001) Petroleum Prospects in Bonaparte Gulf Basin North-West Australia. Leo W. Stach, 30th April 1958. (PR19580002) Progress Report Permit No 3 Bonaparte Gulf Basin. E. D. Utting, Westralian Oil Limited, 1610-58. (PR19580003) Gravity and Geological Investigations North of the Moyle Rive-Port Keats area Northern Territory. J.E. Burbury (Minad) September1958. (PR19580001) Preliminary Notes on Aeromagnetic Survey-Permit 2.L.J.Starkey, Minad, March 1959 (PR19590002) Bonaparte Gulf Basin Oil Permit 3 Northern Territory Interpretations of Geoseismic Survey 1960. E.D. Utting, Westralian Oil Limited (PR19600007) Seismic Ledger Keep River Seismic Survey Port Keats area. (PR19610003B) Spirit Hill 1(deepened) Well Completion Report. Oil Development N.L., December 1961 (PR19610012) Spirit Hill Seismic Survey conducted for Oil Development N.L. General Geophysical Company (Bahamas) Limited 1962. (PR19610014) Seismic Survey Report Keep River Area 0P 2 Northern Territory. Geophysical International. (PR19620015)

R.A.Meaney &Associates November 2010

EPA 175 Australian Aquitaine Petroleum Pty Ltd Point Pearce Seismic Survey. Compagnie Generale de Geophysique. 1963 (PR19630019) Seismic Ledger Point Pearce Seismic Survey (PR19630019B) Experimental Recordings Point Pearce Seismic Survey (PR19630019B) Shallow Core Drilling Report-Sugarloaf (OP 2- area south of Port Keats) A. Duchemin and N. Kemp, AAP Pty Ltd 1964 (PR19640013) Seismic Ledger Kulshill Seismic and Gravity Survey. (PR19640014B) Seismic Ledger Queens Channel Marine Seismic Survey. (PR1965002) Seismic Ledger Moyle River Seismic and Gravity Survey. (PR19660006) Aquitaine Kulshill 2 OP 2 Northern Territory Well Completion Report. K.J. Creevey, AAP Pty Ltd, (PR19660007) Seismic Ledger Cape Hay-Cape Ford Marine Seismic Survey 1966. (PR19660012A) Aquitaine Moyle 1 OP 2, Northern Territory Well Completion Report. F Brophy AAP Pty Ltd, December 1966. (PR19660009) Seismic Ledger Oakes Creek Seismic and Gravity Survey. (PR 19670019B) Aquitaine Kulshill 1 Authority to Prospect OP 2 Northern Territory. Well Completion Report, AAP Pty Ltd September 1966 (PR19660022) An Attempt at the Geological Interpretation of the south and southeast of the Bonaparte Gulf Basin Permits OP2, OP 83 and PE 127H. J. P. Caye and A. Duchemin AAP Pty Ltd, April 1967 (PR19670021) Final Report Hyland Marine Seismic Survey Bonaparte Basin Northern Coast of Australia O2 and OP 3 for AAP Pty Ltd. Western Geophysical Company of America 1967. (PR19680003) Seismic Ledger Hyland Marine Seismic Survey. (PR19686003E) Final Report Keep River Reflection Project for Westralian Oil Limited. R.E. Aasted, Geophysical Service International Party 826 (PR 19680005) Keep River 1 Well Completion Report OP 2 Northern Territory. J.P.Caye, AAP Pty Ltd, June 1969 (PR19690009) Seismic Ledger Lone Hill Seismic and Gravity Survey. (PR19690012) Review of Exploration Results and Petroleum Potential in the NT/P17 and OP 162Permits (Northwestern Australia) S. Mulle and K. Creevey, AAP Pty Ltd, January 1971. (PR19710021) Seismic Ledger Border Creek La. (PR1970002C) Seismic Ledger Quinns Seismic Survey. 9PR 19740004B) AAP Pty Ltd Kinmore 1 P17 Northern Territory Well Completion Report. B. Laws and . Clerc, AAP Pty Ltd, November 1974 (PR19740021) Sedimentological Study of Ningbing Limestone (Upper Devonian) in Aquitaine Keep River 1 (from 11,700-15,623) Northern Territory. R. Elloy, Aquitaine France, August 1980. (PR19800030) Analyses of Lower Carboniferous to Upper Permian core samples from mineral exploration core holes (onshore Bonaparte Basin-Australia). Aquitaine France (PR19820008) Bonaparte 2 (Australia) 1.) Optical and Geological Matter (1,500- 6,000) 2.)Comparison with Lesueu 1, Keep River 1and mining exploration holes. Aquitaine France, December 1981. (PR19820008)

R.A.Meaney &Associates November 2010

EPA 175 Diagenesis of Sandstones from the Bonaparte Basin North Australia, A Pilot Study. A.E. Rahdon Shell Development (Australia) Pty Ltd, April 1982 (PR19890029) Permit NT/P28 Barnett Oil Field Kuriyippi Formation oil-in-place. D. Grybowski, Santos Limited, January 1993 (PR19940004) Report on Seismic Attribute Work relevant to depth mapping of the Barnett Kuriyippi Formation Oil Field. Paul Walsh, D. Grybowski, and M. Browne, Santos Limited, January 1993 (PR19940005) NT/P28 Barnett Structure Near Top Kuriyippi Formation Depth Mapping Review. Mark Brown, Santos Limited, January 1993 (PR19940006) Reservoir Potential of the Langfield Group in the Barnett Area. David Grybowski, Santos Limited, January 1993 (PR19940007) Core Analysis Report Sunbird 1. Geotechnical Services Pty Ltd, November 1994 (PR 19940059) Exploration Drilling EP32 and EP 57Joseph Bonaparte Gulf, Northern Territory Environmental Report. Le Provost, Dames and Moore, February 1994 (PR19940060) Positioning Report for Teikoku Oil (Bonaparte Gulf) Co., Limited of the positioning of the drilling rig Ron Tappmeyer. (PR19940061) Baker Hughes Integrated Drilling Fluids Report prepared for Teikoku Co. Limited Kingfisher 1 offshore Bonaparte Basin EP 57. (PR19940067) Sidewall Core Descriptions Kingfisher 1. S. Falloon, Teikoku Oil (Bonaparte Basin) Co., Limited (PR 19940068) Capital Energy N.L. RL 1 onshore Bonaparte Basin Northern Territory Weaber 3 Well Completion Report. (PR19950035) Teikoku Oil (Bonaparte Basin) Co., Limited Sunbird 1 Well Completion Report. February 1995. (PR19950035) Teikoku Oil (Bonaparte Basin) Co., Limited Kingfisher 1 Well Completion Report. January 1995. (PR19950036 Palynology Onshore Report Sunbird 1 EP 32 Bonaparte Basin. Geotechnical Services Pty Ltd, January 1995. (PR 19950080) Onshore Petrographic Analysis Sunbird 1. Geotechnical Services Pty Ltd, December 1994 (PR 19950081) Paleontological Examination of Drill Cuttings and Side wall Cores from Sunbird 1 Bonaparte Gulf, Northern Territory, Australia. Geotechnical Services Pty Ltd, January 1994 (PR19950035L) Hydrocarbon Characterization Study Sunbird 1 Geotechnical Services Pty Ltd, January 1994 (PR19950084) Kingfisher 1 Paleontological Examination of Drill Cuttings and Side wall Cores from Kingfisher 1, Northern Territory, Australia. Geotechnical Services Pty Ltd, August 1994 (PR19950085) Palynology Report Kingfisher 1 EP 57 Bonaparte Basin. Geotechnical Services Pty Ltd, October 1994 (PR19950086) Log Interpretation Report Kingfisher 1.T.L. Gordon (PR19950087) Petrographic Analysis of 12 Side Wall Cores from Kingfisher 1. Geotechnical Services Pty Ltd, July 1994 (PR 19950088)

R.A.Meaney &Associates November 2010

EPA 175 Hydrocarbon Characterization Study Kingfisher 1. Geotechnical Services Pty Ltd, November 1994 (PR 19950089) Pincombe 1 Well Completion Report Shane Hibberd, Amity Oil N.L. (PR19970001) Seismic Ledger 1996 Weaber Plains Seismic Survey. (PR19970003) Weaber 4 Well Completion Report. G Irwin, Amity Oil N.L., February 1994 (PR199800040 Seismic Ledger Weaber Plains Seismic Survey (1997Reprocessing) (PR19980058) Weaber 5 Well Completion Report. Greg Irwin, Amity Oil N.L., November 1998 (PR 19990002) Data Processing Report area Southern Bonaparte/ Petrel Basin Survey-Shakespeare 3D Block NT/57. Report to Woodside Energy Ltd from Western Geco. (PR20010013) Seismic Interpretation Report NT/P57 Shakespeare 3D Survey Bonaparte Basin. Woodside Australian Energy Limited, August 2002 (PR 20030017) Well Completion Report Shakespeare 1 Interpretive Data NT/57, Bonaparte Basin. Woodside Australian Energy Limited, December 2003 (PR20030105) APP Weaber 1 Well Completion Report. I. Garside, APP Pty Ltd, 8-4-83 (PR19830044) Weaber 1 Core Photographs (Core #2). APP Pty Ltd (PR19840116) Petroleum Geochemistry;-Geochemical Data from eleven wells from the Bonaparte Basin of the Northern Territory. Analabs. (PR 19850033) Barnett Seismic SurveyPermitNT/P28 Bonaparte Basin, Australia. PH. Coisyand R DeLastic, AAP Pty Ltd, May 1985 (PR19850049) Offshore Bonaparte Basin. M majedi, Santos Limited. (PR19850061) Barnett 1 Well Completion Report. R.J. Lee and Ph Baffray, AAP Pty Ltd, August 1985(PR198500800) Seismic Ledger 1984 Spirit Hill Seismic Survey (Santos Limited) Weaber 2/2A Well Completion Report. M. Turner and M. Badcock. Santos Limited, July 1989 (PR19880053) Vitrinite Reflectance Determinations and Maceral Analyses. Report for WMC BY Amdel, September 1983 (19870025) Seismic Ledger 1987 Weaber Plains Seismic Survey. (PR19880085) Seismic Ledger 1987 Pincombe Seismic Survey. (PR19880087) Weaber 2/2A Well Completion Report (Raw Data). C Ford, Santos Limited, December 1988 (PR 19880096) Barnett 2 Final Well Report for Elf Aquitaine Exploration Australia Pty Ltd. Geotechnical Services Pty Ltd (PR 19890074) Barnett 2 Well Completion Report (Basic Data). Paul Faehrmann, Santos Limited., March 1990 (PR19899974) Barnett 3Well Completion Report (Interpreted Data). Simon Mc Guire, Santos Limited, June 1991 (PR 19910071) Seismic Ledger 1984 Barnett-Siren Marine Seismic Survey (1990 Reprocessing) Seismic Ledger Barnett 1990 (B90) 3D Seismic Survey (PR19900089) Geophysical Interpretation Report of the B90 2D/3D Seismic Survey incorporating Barnett 3D, Barnett North and Northwest 2D grid and Siren 2D. R.J. Taylor and Al Panting, Santos Limited, June 1991. (PR19900089) Milligans Formation Well Log Facies Study onshore Bonaparte Basin WA and NT. J. Gausden (PR19910078)

R.A.Meaney &Associates November 2010

EPA 175 BHP Petroleum Billawock 1 Well Completion Report (Interpretive Data) BHPP, December 1992 (PR19920117) Shallow water (Teikoku Oil) Marine Seismic Survey Bonaparte Gulf 1992. (PR 19920176 and PR 19920077) Petrographic Study on conventional cores from eight wells, Australia (Keep River 1, Ningbing 1, Bonaparte 1,Turtle 1,Barnett 2, Kulshill 1, Kulshill 2,and Yampi 1. Technical Research Centre, Teikoku Oil co. Ltd, Japan, September 1993 (PR19930070) Stable Carbon Isotope Ratios of 110 core samples from eight wells, Australia (Keep River 1, Ningbing 1, Bonaparte 1, Turtle 1,Barnett 2,Kulshill 1, Kulshill 2 and Yampi 1) Technical Research Centre, Teikoku Oil Co. Limited, Japan, September 1993 (PR 19930068) Southern Bonaparte Basin Thermal History Assessed using Apatite Fission Track Analysis and Vitrinite Reflectance, Geotrack International Report 8337, September 1991. (PR19930052) Seismic Ledger 1992 Reprocessed Spirit Hill Seismic Survey (PR19930019) Final Operations Report for Teikoku Oil (Bonaparte Basin) Oil Co., Limited Bonaparte GulfAustralia1992 Survey 11th July 1992-6th August 1992. Western Geophysical Co of America, M/V Western Orient, Party 130. (PR19930004(A,B,C,D,J and M) Report on Coal Exploration in Coal Licence 172 Port Keats area Northern Territory. Report to Thiess Brothers Pty Limited by Geotechnics (Australia) Pty Ltd, March 1967 (PR19670003) Report on Coal Exploration in Coal Licence 172 Port Keats area Northern Territory. Report to Thiess Brothers Pty Limited by Geotechnics (Australia) Pty Ltd, Februart 1968 (PR 19680070) Quarterly Report for August-October on Coal Licence 173Northern Territory. Utah Development Company (PR19730082) Coal Licence 1 Bonaparte Basin NT Final Report. CRA Limited, May 1983 (PR19830177) Licence to Search for Coal Number 2 Keep River Final Report. WMC, October 1983 (PR 19830300) Geology of Victoria River Area. Associated Freney Oil Fields N.L Permit 1 Northern Territory. Report to Associated Freney Oil Fields by Minad (compiled by A.C.M. Laing and R.J. Allen). May 1956. (PR56/003) Oakes Creek Seismic and Gravity Survey August- October 1967. Report to Australian Aquitaine Petroleum Pty .Ltd by Compagnie Generale de Geophysique. (PR67/19) Overview of OP 186 Exploration Result and Proposed 1986 Geologic Field Work. Compiled by K.T Tjhin and M. Majedi, Santos Limited July 1986 (PR86/084) 1988 Forsyth Seismic Survey Bonaparte Basin O.P. 186 Northern Territory. Report to NT Department of Mines and Energy. Bonaparte 2 (Australia) Optical and Geochemical Study of Organic Matter (1500 feet to 6000 feet) and Comparison with Lesueur 1 and Keep River 1 (PR82/008) Vitrinite Reflectance Determinations and Maceral Determinations for Western Mining Corporation Ltd. Quarterly Report April 18 1986 - July 17 1986. Report to the NT department of Mines and Energy by Santos Limited Survey Report JMR 1 Sat /Dop Observations for Australian Aquitaine Petroleum Pty. Ltd. (PR82/09)

R.A.Meaney &Associates November 2010

EPA 175 Review of Geology and Hydrocarbon Potential of OP 186, Northern Territory. Internal Report for Alliance Petroleum International compiled by R Blake March 1984 (PR GP 125 Northern Territory BNT80 Seismic Survey Interpretation Report. O.P. 186 Bonaparte Basin. Report to the NT Department of Mines and Energy by Australian Aquitaine Petroleum Pty. Ltd. (PR82/01) GP 135 Interpretation Report O.P. 186 Northern Territory BNT81 Seismic Survey Bonaparte Basin. Report to the NT Department of Mines and Energy by Australian Aquitaine Petroleum Pty. Ltd. (PR82/78) Weaber Field Northern Territory R.L. 1 Gas in Place Report. Internal Santos Limited Report compiled by S. Jones. (PR92/17) Proposed Howland Marine Seismic Survey NT/P28 (Petrel and Tern Detail) Report to the NT Department of Mines and Energy by Australian Aquitaine Petroleum Pty. Ltd. (PR80/18). O.P. 186 Northern Territory A Review of Reflection Seismic Data. Internal Australian Aquitaine Petroleum Pty. Ltd report compiled by G. Magnien April 1980. (PR80/028) Northern Territory Geological Survey Basin Petroleum Basin Study Bonaparte Basin compiled by Petroconsultants Australasia Pty. Ltd. June 1990 The Petroleum Geology of the Onshore Bonaparte Basin. R. Laws Australian Aquitaine Petroleum Pty. Ltd. In 1981 APEA Journal The Sedimentary Basins of Western Australia :An Introduction P.G and R. R. Purcell in The Sedimentary Basins of Western Australia Edited by P.G and R.R. Purcell 1994 Waterloo Northern Territory 1:250,000 Geological Series Explanatory Notes Department of Minerals and Energy Bureau of Mineral Resources, Geology and Geophysics 1973 Port Keats Northern Territory 1:250,000 Geological Series-Explanatory Notes Department of National Development Bureau of Mineral Resources, Geology and Geophysics 1972 Limbunya SE-07 1:250,000 Geological Map Series Explanatory Notes (2nd Edition) Northern Territory Northern Territory Geological Survey Department of Business, Industry and Development. September 2002 Victoria River Downs SE 52-4 1:250,000 Geological Map Series Explanatory Notes (2nd Edition) Northern Territory Geological Survey Northern Territory Department of Business, Industry and Resource Development. August 2002. Auvergne SD 52-15 1:250,000Geological Map Series Explanatory Notes Northern Territory Geological Survey Department of Mines and Energy 2000

16

GLOSSARY

Below are simple and brief explanations of some of terms used in this report, other terms are defined within the report:Anticline: Anticlinal trap: a tectonic structure in which strata are folded so as to form an arch or dome. a hydrocarbon trap formed by the upward bowing of strata into a dome or arch.

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Appraisal well: a well drilled to determine the extent of hydrocarbons discovered in previous well on the same structure. the unit of volume measurement used for petroleum and its products. 1 barrel = 42 U.S. Gallons = 35 Imperial Gallons (approx.) or 159 litres (approx.) BCF: bopd: Basin: Cambrian: Carbonates: billion cubic feet (109 cubic feet) = 28.317 million cubic metres. barrels of oil per day. a depression of large size in which sediments have accumulated. a geological time period approximately 545 to 490 million years ago. sedimentary rocks composed of calcium and/or magnesium carbonate e.g. limestone. a geological time period approximately 354 to 298 million years ago a sedimentary rock composed predominantly of particles less than silt size usually comprising clay minerals. the area within the lowest closing contour of a structure, also, a closed structure. See four-way dip closure. hydrocarbons (predominantly pentane and heavier compounds) which spontaneously separate out from natural gas at the wellhead and condense to liquid. the highest point on a four-way dip closed structure, also used to indicate that a four-way dip closure exists. a geological time period approximately 141 to 65 million years ago an area or site of maximum deposition in a sedimentary basin. a low place of any size on the Earths surface, also may refer to a sedimentary trough or basin the laying down of potential rock forming material i.e. sediments. a geological time period approximately 410 to 354 million years ago. the angle of the plan of a bed relative to the horizontal.

Barrel (bbl):

Carboniferous: Claystone:

Closure:

Condensate:

Culmination:

Cretaceous: Depocentre: Depression:

Deposition: Devonian: Dip:

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EPA 175
Dry hole: Exploration well: a well drilled without finding gas or oil in commercial quantities. a well drilled to determine whether hydrocarbons are present in a particular area or structure. the rock record of any sedimentary environment, including both physical and organic characters. a fracture in the Earths crust along which the rocks on one side are displaced relative to those on the other. A hydrocarbon trap which relies on the termination of a reservoir against a seal, due to fault displacement. a geographical area under which an oil or gas reservoir lies. a bend in strata, commonly a product of deformation. a unit in stratigraphy defining a succession of rocks of the same type. a structural feature seen on orthogonal seismic lines to dip away in all four possible directions, closure indicating that any hydrocarbons beneath a sealing stratum will be trapped in this feature. an estimated measure of the total amount of gas contained in a reservoir and, as such, a higher figure than Recoverable Gas. the science relating to the history and development of the Earths crust. the physics of the Earth; a hybrid discipline involving a combination of physical and geological principles. naturally occurring organic compounds containing only the elements hydrogen and carbon that may exist as solids, liquids or gases. a term used in seismic interpretation to identify the signal reflected from a particular layer of rock. existing within a geological formation, for example a single shale bed in an alternating sequence of sands and shales may be an intraformational seal. a geological time period approximately 205 to 141 million years ago. sediments deposited in a lake environment. inferred geologic feature or structural pattern requiring investigation.

Facies/lithofacies:

Fault:

Fault trap:

Field: Fold/Folding: Formation: Four-way dip:

Gas in Place (GIP):

Geology: Geophysics:

Hydrocarbons:

Horizon:

Intraformational:

Jurassic: Lacustrine: Lead:

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Licence: an authority to explore for or produce oil or gas in a particular area issued to a company by the governing state. a rock composed of calcium carbonate. the physical and mineralogical characteristics of a rock. see well log. technical analysis of the results of well logging leading to quantitative estimates of various rock properties including contained liquids and gases. deposited in the sea. the condition, caused by pressure, temperature and time, in which organic matter in a potential source rock will be converted to hydrocarbons. The geological era extending approximately from 225 to 65 million years ago Mesozoic: Migration: MMSTB: MMCFD: Net Pay: the movement of hydrocarbons from regions of higher to lower pressure. millions of standard barrels. millions of cubic feet per day = 28,317 cubic metres per day. the subsurface geological layer where a deposit of oil or gas is found in potentially commercial quantities. Net present value. A monetary value for future cash flows which is discounted to allow for the time value of money. a mixture of liquid hydrocarbons of different molecular weights. a geographical area under which an oil reservoir lies. an estimated measure of the total amount of oil contained in a reservoir and, as such, a higher figure than Recoverable Oil. a geological time period approximately 490 to 434 million years ago. a measure of the capacity of rock or stratum to allow water or other fluids such as oil to pass through it. a geological time period approximately 298 to 251 million years ago.

Limestone: Lithology: Log(s): Log interpretation:

Marine: Mature (source):

NPV

Oil: Oil Field: Oil in Place (OIP):

Ordovician: Permeability:

Permian:

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EPA 175
Petroleum: a generic name for hydrocarbons, including crude oil, natural gas liquids, natural gas and their products. the set geological conditions which give rise to petroleum accumulations. the physical properties of rocks, in this context, as measured by well logs. a pipe through which oil, its products, or gas is pumped between two points, either offshore or onshore. the ratio of the volume of pore space in rock to its total volume, expressed as a percentage. a feature sufficiently defined to warrant the drilling of a well without the necessity of further investigation. Pressure vs compressibility, an Engineering analysis used to calculate reserves of gas. a mineral composed of silicon dioxide. the most recent geological era, commencing approximately 1.8 million years ago. an estimated measure of the total amount of gas which could be brought to the surface from a given reservoir; this is usually of order 60% - 70% of the estimated Gas in Place. an estimated measure of the total amount of oil which could be brought to the surface from a given reservoir; this is usually less than 50% of the estimated Oil in Place and commonly in the 20% to 40% range. pervious and porous rocks (usually sandstone, limestone or dolomite) capable of containing significant quantities of hydrocarbons. an expression of uncertainty (high risk) or uncertainty (no risk) often relating to the presence of principal geological factors controlling oil accumulations. the irregularity or roughness of a borehole, often caused by unstable formation or by poor drilling practice. a sedimentary rock composed predominantly of sand sized grains, usually quartz. an impermeable rock (usually claystone or shale) that prevents the passage of hydrocarbons.

Petroleum system: Petrophysical: Pipeline:

Porosity:

Prospect:

P/Z

Quartz: Quaternary:

Recoverable Gas:

Recoverable Oil:

Reservoir:

Risk:

Rugosity:

Sandstone:

Seal:

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EPA 175
Seismic survey: a technique for determining the detailed structure of the rocks underlying a particular area by passing acoustic shock waves into the strata and detecting and measuring the reflected signals. solid material, whether mineral or organic, which has been moved from its position of origin and redeposited. a rock formed as a result of the consolidation of sediments. a claystone exhibiting a finely laminated structure. an indication of oil or gas from an exploratory well. rock intermediate in texture and grain size between sandstone and claystone. rocks (usually claystone or coal) that have generated or are in the process of generating significant quantities of hydrocarbons. the study of stratified rocks, especially their age, correlation and character. a trap formed as a result of folding, faulting or a combination of both. deformed sedimentary rocks, where the resultant bed configuration is such as to form a trap for migrating hydrocarbons. descriptive of all movements of the Earths crust caused by directed pressures, and the results of those movements. an era of geological time approximately 65 to 1.8 million years ago. Total organic carbon (content as a %age) a body of reservoir rock, vertically or laterally sealed, the attitude of which allows it to retain the hydrocarbons that have migrated into it. a strike direction of a geological feature. a geological time period approximately 251 to 205 million years ago. lack of parallelism between rock strata in sequential contact, caused by a time break in sedimentation. the direction leading most directly to higher elevations on an inclined stratum or structure. elevation of any extensive part of the Earths surface relative to some other

Sediment:

Sedimentary rock: Shale: Show: Silt/siltstone:

Source rocks:

Stratigraphy: Structural Trap: Structure:

Tectonic:

Tertiary era: TOC Trap:

Trend: Triassic: Unconformity (angular) Updip:

Uplift:

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EPA 175
part. Well-log (log): a recording of rock properties obtained by lowering various instruments down a drilled well by means of a wireline.

R.A.Meaney &Associates November 2010

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