Slide 1: Kangaroo Creek Sandstone Resource
For personal use only Red Sky Energy Kangaroo Creek Sandstone Resource August 2011
Slide 2: Clarence Moreton Basin – results to date
Clarence Moreton Basin – results to date For personal use only • Initial focus on Walloon coal seam gas • Two core hole program – Annvale 1 core hole in PEL 479 – Talma 1 core hole in PEL 457 – Target Walloon coal measures – Completed in April this year • Very successful program – Approx pp 20 metre
Slide 3: Discovery well - Talma 1
Discovery well ‐ Talma 1 For personal use only Kangaroo Creek Sandstone (KCSS) Resource • Gas spikes from KCSS while drilling Talma 1 core hole ndstone • Set casing at 480m depth • Cored lower 82m of KCSS of ~500m total thickness Kangaaroo Creek San • Drill D ill SStem TTest 4 at 545 m to 555 m d de
Slide 4: Geological setting
Geological setting For personal use only • Clarence Moreton Basin has been uplifted and the top 2000m eroded • Kangaroo Creek Sandstone is a bowl shaped bed in the central part of the basin • Thickness of KCSS up to 500 metres • Talma 1 and Annvale 1 were drilled in the central portion of the bed
Slide 5: Areal extent
Areal extent For personal use only Annvale 1 outcrop 30kms KCSS o Talma 1 5
Slide 6: Geological model
Geological model For personal use only • Deposition of KCSS was deposited in a relatively low energy braided stream setting in late Jurassic • Massive sand with clays deposited on the bedding planes – It had excellent original reservoir properties • Buried 1‐2km by younger sediments – This caused di
Slide 7: Core analysis
Talma 1 core analysis For personal use only • Analysis conducted – Visual examination by specialist sedimentologist – Logs g interpreted p byy MBA Petroleum Consultants – Plugs were taken at selected locations for porosity and permeability measurements – Thin sections were made from samples at two l
Slide 8: Core analysis: lithology, porosity, permeability
Talma 1 core analysis For personal use only Lithology Porosity Permeability Clays Qtz 30% 20% 10% 0% 0.1 1 10 100 High K streaks 500m 500m 550m 550m 8
Slide 9: Reservoir properties
Reservoir properties For personal use only Porous but tight reservoir, with porosity 10 ‐ 12% and permeability generally less than 1mD There are high permeability streaks along the clay‐rich bedding planes due to dissolution during uplift The sands will contain a significant volume of gas but will f
Slide 10: Western Canada analogy
Western Canada analogy For personal use only • There are a number of shallow gas basins in North America, but the best analogy appears to be in southern Alberta and Saskatchewan and in central and eastern Montana. Montana • The reservoir properties are similar to those of the KCSS • Contain approxim
Slide 11: Potential producibility
Potential producibility For personal use only • The KCSS resource will flow predominantly from the high permeabilityy streaks p • Well completion needs to maximise intersection of these streaks • Field development scenario has been developed based on production wells from Canadian shallow gas • Esti
Slide 12: Proposed appraisal - Talma Pilot
Proposed appraisal‐ Talma Pilot For personal use only • Single well pilot, re‐enter Talma 1 core hole • Planned Pl d to t drill d ill the th pilot il t wellll d during i Q4 2011 (subject ( bj t to regulatory approvals which are pending) • Commence production by year end • Drill with air to avoid wat
Slide 13: Disclaimer
Disclaimer For personal use only The information presented herein contains predictions, estimates and other forward looking statements that are subject to risk factors that are associated with the oil and gas business. Certain information in this presentation has been derived from third parties and,