L7

LOCATION

The Licence overlies the Allanooka Terrace in the North Perth Basin and is adjacent to the prolific Dandaragan Trough, and south of Geraldton, located some 5 hours drive north of Perth.

EXPLORATION POTENTIAL

• The Mount Horner Field, which was shut-in during 2011 due to high water cut and aged infrastructure, had produced approximately more than 1.7 mmbls of oil, outperforming initial volumetric estimates when the field was first discovered and developed;
• Preliminary mapping has identified a Mount Horner lookalike prospect called Delilah, which is on trend and north of the existing Mount Horner Field with prospectivity at both the Jurassic and Permo-Triassic levels;
• The Becos structure/lead in EP437 down-dip of the Wye-gas discovery, a similar downthrown fault play as identified in areas in L7, is now mapped to be much larger and spills into L7 based on current 2D seismic;
• Much of the Mount Horner oil was produced from the Jurassic level and importantly the Permian and Triassic prospectivity in the northern part of the basin appears to have been overlooked;
• Permian and Triassic level oil prospectivity represents an underexplored oil play in the northern margin of the Perth Basin;
• Oil was recovered at Mount Horner-3 and 5A on the downthrown side of the Mount Horner Fault from Permian objectives;
• The Permian prospectivity has been the focus of gas exploration south at the Dongara and Waitsia Fields by AWE but neglected for oil exploration onshore in the Perth Basin;
• Importantly the Dongara and Hovea Fields are interpreted to be dual charge systems where the majority of initially charged oil has been expelled into structures in the northern part of the basin on trend from the Dandaragan Trough which encompasses Key’s EP437 and L7 interests. This opportunity represents a significant expansion of Key’s Australian assets, consistent with a well-defined exploration and commercial strategy which now includes a portfolio of lower risk oil prospects in the onshore Perth Basin coupled with larger higher risk undrilled structures offshore;
• Initial assessment of L7 opportunity identified that new discoveries could be more commercial if oil was trucked to other oilfield facilities in the Perth Basin unlocking potential partner synergies with other Perth Basin Operators.

FORWARD WORK PROGRAM

The majority of infrastructure at Mount Horner will be part of a field work and rehabilitation campaign that will ensure ongoing maintenance and integrity of the facility.