Central Petroleum expands unconventional acreage with new targets in central Australia

Central Petroleum (ASX:CTP) has uncovered up to 260,000 square kilometres of additional unconventional play targets in the Amadeus, Eromanga, Wiso and Pedirka Basins in central Australia, through a review of historical and recent data, that could increase the company’s total area of unconventional play potential to over 307,000 square kilometres.

The additional unconventional play exploration targets in the Palaeozoic and Pre-Cambrian throughout the Lander Trough of the Wiso Basin, the Amadeus Basin and Pedirka/Eromanga Basins are represented by known mature source rocks with elevated total organic contents in a series of superimposed (vertically stacked) horizons which have been drilled, at least in part.

Managing director John Heugh told Proactive Investors today the potential size of these plays represents a substantial prospective addition to the company’s portfolio.

“The total surface area of these additional plays is approaching 70 million acres (280,000 square kilometres), which is an enormous portfolio of unconventional exploration plays,” he said.

“Even if only 10% of that is a prospective play that’s an enormous chunk of 7 million acres of ground added to our existing 11 million acres of known unconventional plays that we have.”

Many of these horizons have been logged, sampled and analysed but not specifically for the purposes of unconventional exploration.

The potential for Central lies in the development of not just one play in one horizon, but underneath the known horizons such as the lower Larapinta Group in the Amadeus Basin and the Arthur Creek Formation in the Southern Georgina Basin.

“Those plays are both pretty well known and independently assessed, but if we are drilling deeper targets than the Amadeus, and we will be, we can examine the unconventional potential of possibly several superimposed plays, one on top of the other, with the one well,” Heugh said. 

The results that led to the discovery of the additional targets are preliminary and based on sparse drilling and sampling from historical and recent exploration over a 50 year period.

Central will need to undertake more exploration, sampling and analyses before the company can deliver any resource figures.

The company plans to drill the Mt Kitty well next year, which will test the unconventional potential of one or two of the additional play types.
   
“The first test that’ll be gathering some modern data on some of these additional unconventional plays will be Mt Kitty. We’ll be drilling through several of these potential horizons on the way down to the Heavitree formation,” Heugh said.


Share Purchase Plan

In November, Central announced an extension to its share purchase plan to eligible shareholders to raise A$5.5 million. The share purchase plan is now due to close on 6 December 2011.

Eligible shareholders can purchase shares to a value of $2,500, $5,000, $7,500, $10,000 or $15,000, at an 18% discount to the average closing price of shares in the five days prior to the announcement of the share purchase plan on 15 September 2011.


Cash Position

At the end of the September quarter Central had $13.3 million cash in the bank, which will receive a further boost with the addition of the funds from the share purchase plan.

Originally published at: http://www.proactiveinvestors.com.au/companies/news/22851/central-petroleum-expands-unconventional-acreage-with-new-targets-in-central-australia-22851.html