Mosaic Oil provides production and drilling schedule update at the Surat-Bowen Basin.

Highlights

• Net daily production of over 1500 BOEPD achieved in June 2008 against an original target of 1440 BOEPD for July 2008

• Cash balance (unaudited) of over $23 million at 30 June 2008

• 2008 Drilling Program to be increased to 12 wells from originally planned 10 wells

• On track to achieve revenue target of $32 million for 2009 Financial Year

Fairymount-9 (PL 46 – MOS 100%) has been on pump since early April 2008. However the production has declined to approximately 4 BOPD (barrel of oil per day) with high watercut.

Waggamba-4H (PL 202 - MOS; 50% gas, 65% free oil/condensate) has been on continuous production since late May 2008. The well is free flowing at a controlled stabilised rate of 1.2 MMSCFD (approximately 1.6 TJ/d) of gas and approximately 145 BOPD through an 18/64" choke.

Taylor-18 (PL 49 – MOS 100%) was brought on continuous production in early June 2008. The well is free flowing at a controlled stabilised rate of 2.1 MMSCFD (approximately 2.5 TJ/d) of gas and 20 BOPD.

Mosaic’s Managing Director, Mr Lan Nguyen, said "we are extremely pleased with the controlled stabilised production rates of both Waggamba-4H and Taylor-18. We would reasonably expect the contribution from these two wells alone to the Company’s FY2009 sales revenue to be at least $11 million. By comparison, Mosaic’s total revenue in the 2007 Financial Year was $18 million," Mr Nguyen said.

The 2008 operated drilling program has now increased to planned 12 wells. The additional wells are Waggamba-6H and Waggamba-7H horizontal wells.

Tags: Mosaic Oil, Surat-Bowen Basin