Essential Petroleum Resources Limited has accepted the offer of a major new onshore exploration permit, PEP 168, in the Port Campbell gas province in the Otway Basin.

EPR (operator) with a 50% equity share and its joint venture partner, Inland Oil Resources Pty Ltd (IOR) 50%, intend to drill the first of several proposed wells as early as the third quarter of 2007.

At least two wells will be drilled in the first three year term of the permit with one more well required in the last two years of the five year life of the permit. PEP168 is a highly prospective permit covering the onshore part of the Pecten High trend which hosts in excess of 400 bcf reported gas reserves in Waarre reservoir sands in the offshore Casino, Henry, Martha and Halladale fields.

PEP 168 surrounds and adjoins onshore gas fields which have produced more than 100 bcf of gas from highly productive Waarre reservoir sands. Gas fields in the Port Campbell Embayment region include the McIntee, Naylor, North Paaratte and Iona fields.

This is the first time the permit has been offered by the Victorian Government since the initial discoveries were made in the early 1990’s. Essential Petroleum Managing Director, John Remfry said, “Essential Petroleum has long been aware of the undiscovered potential of the area and has waited patiently for the opportunity to bid on this block.”

Mr Remfry said, “The permit has an extensive, modern 3D seismic data coverage obviating the need for any more seismic acquisition prior to drilling. EPR has identified from seismic, several untested prospects exhibiting the same direct hydrocarbon indicators (DHI’s) as many of the nearby producing fields. This substantially increases our chances of making an early discovery in this highly prized permit.”