Austin Exploration Limited (ASX:AKK) Commences Preparations for Oil Drilling at Cooper Basin Project

Sydney, Oct 20, 2011 AEST (ABN Newswire) - Austin Exploration Limited (ASX:AKK) is pleased to inform shareholders that preparations are underway for the start of the oil drilling program on the highly-prospective Cooper Basin PEL 105 licence area in South Australia.

News of a start to the Cooper Basin drilling program follows an incredibly frustrating period for the Company, its PEL 105 joint venture partner, Adelaide Energy (ASX:ADE), and shareholders.

"We are very pleased to advise that following a recent field trip to the site, the licence area has dried out sufficiently from prolonged flooding to allow for rig access and the commencement of drilling," Austin's Chief Executive Officer, Mr Guy Goudy, said today.

"This project has certainly been a true test of patience for us all, especially considering its potential and the fact that our technical work to date has led us to believe that we have a reasonable chance of discovering more than one million barrels of oil from our first well on PEL 105," he said.

"Collectively, both Austin and Adelaide Energy have always seen a tremendous amount of potential in this prospect - a view which is shared by many in the industry. The frustrating problem has been the massive floods in the region which has prevented us from getting to work on the licence area.

"All of Austin's action in the past year has been on the dramatic expansion of our USA oil and gas operations, while our Australian interests have been put on the backburner due to the massive outback floods in South Australia.

"The Austin team could not be happier that preparations for drilling of our first Australian oil well have begun."

Mr Goudy said the go-ahead for the commencement of preparatory work on the drilling program followed a recent site visit to the licence area by Adelaide Energy, Austin's Joint Venture Partner and Operator of the project.

"Adelaide Energy's Managing Director, Mr Carl Dorsch, returned from the site visit with the decision that the risks associated with flooding were sufficiently reduced such that the rig selection process should begin immediately. It is expected that drilling will commence 1st quarter 2012," Mr Goudy said.

In mid 2009, Austin and Adelaide Energy agreed to Joint Operating terms whereby, inter alia, Adelaide Energy would fund the first $1.75 Million towards the first well, to be named Pirie #1. Following the first well, costs will be shared 50/50 for all future work.

About the prospect:

The northern Cooper Basin province hosts the massive 100MMbbl Tirrawarra Oil Field in the liquids rich Patchawarra Trough. ADE acquired 93 km of 2D seismic in 2008 to high grade drilling targets in this proven hydrocarbon province. PEL 105 spans the central Patchawarra Trough from the permits western limit between the Moorari and Kudrieke fields east to the huge Santos-operated Bookabourdie Field.

Re-interpretation of geophysical data has allowed ADE to identify a massive hydrocarbon target between the producing Moorari and Kudrieke Fields. The Pirie-1 exploration well will be drilled in Q1 2012 on a significant closure above the abandoned 1983 Toonman -1 well. The Toonman well intersected tight hydrocarbon saturated sand in an era when fracture stimulation was in its infancy. Austin and Adelaide will fracture the tight sands to access un-risked P10 OOIP of 23 MMbbl and P50 OOIP 2MMbbl.

For the complete announcement including figures and tables, please view the following link:
http://media.abnnewswire.net/media/en/docs/ASX-AKK-185049.pdf

Contact

Guy Goudy Chief Executive Officer Austin Exploration Limited Email: GuyG@AustinExploration.com