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WA companies chase stake in overseas oil, gas fields

HARDMAN Resources may not be the only WA-based oil and gas explorer to ride high on overseas interests this year.

Carnarvon Petroleum, Sun Resources and First Australian Resources are also staking fortunes on projects touted to boost cashflow or improve market interest before year’s end.

Carnarvon has a 40 per cent stake in a Central Thailand project that will produce oil by July. Company secretary Leonard Troncone said the Thai prospect was a proven reserve and Carnarvon and operating partner Pacific Tiger planned to drill at least 10 wells.

Despite regional competition from international players like Shell, Mr Troncone was confident all Carnarvon’s production would find an immediate market with the Thai Government. “The country imports all its oil at the moment,” he said

Carnarvon is looking at acquiring other production opportunities across South-East Asia within the next year.

“We’re absolutely confident of markets for all these,” Mr Troncone said. “Our WA interests are just wildcat projects.”

Sun Resources is sinking a fortune into two oil and gas prospects in the San Joaquin Basin, California. The company is taking advantage of the largely explored and proven US prospects, with ready-made markets and record prices. A stake in the large and troubled Californian energy market from the Eagle development, expected to produce a result by July, could change Sun’s profile considerably.

“Eagle is a top priority exploration and development investment opportunity for a small explorer such as Sun,” managing director Brad Farrell said.

First Australian Resources has a history in the San Joaquin Basin. Chairman Michael Evans said the company was the only profitable partner in the Eagle-1 well, and one of the original partners when the formerly named Mary Bellocchi-1 was first entered in 1986.

“The technology beat us then, but now with horizontal drilling we can draw much more daily production,” he said. “We feel this one has a reasonable chance of success.”

Eagle-1 is only one of several wells in an ongoing US program for First Australian and, as such, carries less significance for the company than for Sun Resources. In January this year the company’s US oil and gas reserves were independently valued at US$20.6 million.

First Australia’s main focus is in Louisiana, where it sells natural gas through the Louisiana pipeline network.

“It’s a huge network,” Mr Evans said. “Our gas is bought by a local buyer, but can end up in Philadelphia or Boston. We can sell it very, very quickly.”

He said the company’s success over the past two years had been driven very much by high US gas prices. While First Australian will drill a well in the North West Shelf later this year, its focus will remain in the US, where proven oil and gas reserves were prolific and there was always an immediate market. One of the company’s Louisiana interests is expected to be producing from a new well by the end of June.

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