Tenements

ATP 626P

One of Icon Energy’s key operations is the coal bed methane gas reserves in permit ATP 626P in the Surat Basin in Queensland. A preliminary estimate of the gas in place is now estimated to be in the range of 2.00 to 7.00 trillion cubic feet (TCF).

The key goal of the 2009 -2010 twelve well program was to fulfil Icon’s obligations under Stage One of the farm in with the Queensland Government owned Stanwell Corporation Limited (Stanwell), and to evaluate gas potential in ATP 626P.

Stage 2 of the Company’s joint venture with Stanwell included the drilling of a further four exploration wells between 15 April and 21 June 2011. The wells were funded by Stanwell under their Stage 2 investment phase. Stanwell’s investment, executed through their wholly-owned subsidiary, Goondi Energy Pty Ltd, has enabled Stanwell to earn a 50% interest in the Lydia area – a four graticular block subset of ATP626P. The objectives of the Stage One and Stage Two Drilling Programmes were to:

1. Identify net coal thickness.
2. Determine gas content and saturations in the coal sections.
3. Obtain estimates of permeability within the Walloon Coal Measures.
4. Analyse the data obtained and select a second pilot area for future development wells in the Lydia Block.

The results of the Stage 2 Drilling Programme revealed lower than necessary permeability to enable proceeding to a second pilot project in the Lydia block. Icon Energy is currently working on a detailed review of the results from the 22 coal seam gas exploration wells drilled in ATP626P since 2007. This work will identify the remaining prospective areas within the tenement.
By notice dated 30 June 2011, Icon Energy expanded the Joint Venture Area to the entire area comprising ATP626P. The expanded Joint Venture Area will be used to establish the Minimum Required Reserve under the Farmin Agreement.

On the completion of technical assessment, a subsequent drilling programme is likely to commence in the new 2011 – 2012 financial year.