v

Attachment 1149° 00' 00" 149° 04' 00" 149° 08' 00"

B Glenora 1

G Coxon Creek 1C)14

G 21

B 15

Coxon Creek 5

B Hermitage 1

B 10

G 13

G 14G 22

B 18B 16

G 11G 4

B 12

G 2

G 19

G 3 AG88a

B 1713

B Mount Hope 1

Pleasant HillsB 24

G 23G 20

B 7

B Dalmuir 1G 6 GA1aPleasant Hills 1

G 5 ATP 336P Roma

B 9

PL 4 C Rowallon 3

B 13

B 7

B

G 6 G 5

G 15G 4

Pine RidgeB 12

RaslieC 2 B 4

G 6

C 11GB88a

B 14

BLYTHDALE

G Pine RidgeG1

10

B 3

C 3C Burgoyne 1

G Raslie 1

B 5

Santos

itchell! RomaWallumbilla

!

Moonie!

Dalby!

DCDB - Freehold

Suburb

Santos production permit

Santos exploration permit

Gas pipeline Oil pipeline

Gas field

Oil field

Qld LGA

ATP 336P - QueenslandProposed

Coxon Creek 5(AGD 66)

2000 0 2000St George

!metres Scale: 1:100,000

Date: Feb 2006, File No. BOWEN 068_5

-26°

28'

00"

-26°

24'

00"

-26°

20'

00"

C

ATTACHMENT 2

COXON CREEK 5WELL PROPOSAL

TOM LONERGAN CSG PILOT WELL

SURAT BASIN, QUEENSLANDATP 336P

Well Type: RSG Pilot Well (CSG)Well Name:Coxon Creek 5

Licence: ATP 336P Joint Venture: Roma Lattitude 26 21 24.70 S (AGD66)Longitude: 149 05 36.94 E (AGD66)Seismic Reference: SP

Voting (%)Santos GroupInterstate Pipelines Pty Ltd

8515

Ground Level: 368.2 mRotary Table: 4 mProposed Total Depth: 403 m SubsurfaceRig: MDC 151Nearby Facilities: Pleasant Hills gathering system

Objectives / Fluid Contacts / Predicted Pay Stratigraphic Prognosis (Subsurface M)Primary Predicted Net

Pay/PorositySecondary Predicted Net

Pay/PorosityJuandah Coal Measures Taroom Coal Measures

N/A N/A

Bungil Fm Mooga SS Orallo FmGubberamunda SS Westbourne Fm Weald SS Springbok SSJuandah Coal Measures Proud SSTaroom Coal Measures Eurombah FmHutton SS

-- 5

25407785167220328393418

Formation Evaluation Hole Design / Drilling IssuesWireline Logging:

TopSurf Cs Surf Cs

Base TD TD

SpecificationsGR/Cal (dual arm) Density

Well Class: CSG Pilot Production WellHole Type:

Hole Size17.5 “

12.25 “8.75 “

Depth50 m150

m TD

Casing Size13.375 ”

9 5/8 ”7 “ (Perf liner optional)

SWC’s: Nil

MDT’s: Nil Drill Fluid:Velocity Survey: Nil Deviation Sub-Surface Targets:

Hole deviation to be kept within acceptable limits to intersect the coal measures within a 50 m radius.

Mudlogging:Two sets of ditch cuttings to be collected and bagged at 10 m intervals from surface to TD

Other Information / Hazards:V low potential for minor overpressure in the Gubberamunda Fm (1-30psi). The formation used extensively (domestic and agricultural) in the northern Roma area and hence is generally depleted. No H2S gas expected.Predicted Flow Rate:

FormationTesting:

Flow testing as required. Nearby Wells: Coxon Creek 1

Coring: Nil

Remarks / Recommendations :Standard Santos procedures to be followed. All post-logging evaluation to be confirmed with CSG (Brisbane).

APPROVED BY:Project LeaderTom Lonergan

Santos CSM Eng:Mark Casey

Operations Geology Drilling EngineerStephen Furze

DEP

TH, m

RT

Drill 8-3/4" hole

Various open hole flow tests

Possible: 7" perforated liner to ~400 m

Coxon Creek 2 - 5 TIME v DEPTH CURVE

0

100

200

300

400

Drill 12-1/4" hole

DAYS FROM SPUD

Coxon Creek - Estimate

0 1 2 3 4 5 6 7 8 9 10500

QDNRM Plan Coxon Creek TvD.xls

Plan: 9-5/8" casing to 150 m

Plan: 13-3/8" casing to 50 m

Drill 17-1/2" hole

PROJECT NAMEJoint VentureRoma JVPrimary ObjectiveWalloon Coal MeasuresJustificationStrategic Opportunity

Block/Licence/State Secondary ObjectiveClassification Appraisal

Roma / ATP336P / QLD

PROJECT OBJECTIVES: Prove commerciality of Walloon production following positive corehole results at Rowallon

14; To address possible reserves of 96.7 PJ and best case contingent resources of 2858 PJ in

the Roma JV area; To provide critical information leading into a PL application in the north-east region of

ATP336P which has an estimated GIP of 200 Bcf. Demonstrate productivity of highly permeable (20 – 200 md) coals through air drilling in

order to reduce damage previously seen from conventional drilling. Recover approximately 1.1 Bcf per well with a headline rate of 1 MMscf/d.

BACKGROUND:Rowallon 14 (Coxon Creek area) and two other coreholes (in the Javel-Wyena and East Pleasant Hills areas) were drilled in late 2005. These coreholes demonstrated permeability, gas content, shale gas desorption, and a free gas cap or over-saturation of the coals in the Coxon Creek area. A summary of the corehole results is as follows:

Property Javel / Wyena (R3) East Pleasant Hills (R13) Coxon Creek (R14)Net Coal ● ●●● ●●●Permeability ●●●● ● ●●●Gas Content ●●● ●●● ●●Free gas ● ●●● ●●●●Offset Integrity Issues

●● ● ●●●●

Existing Infrastructure

●●●● ●●●● ●●

Coxon Creek will be the first area to implement a pilot programme following the corehole results.

The Rowallon 14 corehole demonstrated potential commerciality of the Walloons with the following properties:

Permeability ranging from 20 – 200 mD between seams; Net coal of 11.6m and three times as much carbonaceous shale; Free gas DST’d from the Juandah Coal Measures and Proud Sandstone intervals; No regional casing integrity issues in offset wells presenting possible crossflow; and Less than 10 km from the Pleasant Hills gathering system with installed compression and

spare capacity.

Uncertainties to be addressed in this program include: The extent of aquifer support and associated dewatering time; Drainage area and optimal well spacing; Permeability and deliverability, to be further evaluated with air drilling with the contingency

for underreaming should the seams require stimulation; and Continuity of each coal seam and reservoir heterogeneity.

The well design will involve the following: Top set 9-5/8” casing in the Springbok Sandstone & air drill through the Injune Creek (to

minimise damage seen from previous conventional drilling);

Acquire wireline log data for correlation in each well; Under-ream primary seams if permeability is low; Strip in 2-7/8” tubing if the barefoot interval is gas saturated with good deliverability (a

maximum of 1 well only); Run 7” liner and PCP completion; and Flow test for 3 months.

The well naming will move to a conventional methodology: Rowallon 2 becomes Coxon Creek 2 Rowallon 5 becomes Coxon Creek 3 Rowallon 9 becomes Coxon Creek 4 Rowallon 14A becomes Coxon Creek 5

ATP 336P and Well Locations

APPENDIX A PROPOSAL REVISED INFORMATION:

REVISED WELL DESIGN

The wells will be drilled into the Springbok Sandstone with 9-5/8” casing run and cemented to isolate the Gubberamunda Sandstone. The wells will then be air drilled through the Juandah, Proud and Taroom intervals with regular flow tests to gather information on the deliverability of each package as well as any water influx. The primary reason for the air drilling option is the high skin values from DST’s in the Rowallon 14 corehole. Given the wells will be open-hole, drilling will stop at the Eurombah Formation to ensure the Hutton Sandstone is not reached. Once the total depth has been reached logs will be run and there will be a decision point as to what course is taken; stripping in tubing, underreaming or immediately running a liner.

If the Taroom Coal Measures are also gas saturated and the well is producing gas at a rate of greater then 0.8 MMscf/d, then a slick 2-7/8” production string (with nipple profile and plug) will be stripped in to the top of the Juandah Coal Measures. The major reasons for the stripping tubing option in this case is for a baseline reference in appraising the optimal completion technique (providing a test of deliverability with approximately no skin to directly compare with rates following well killing operations to run liners).

The proposal for stripping in tubing for the high-rate gas saturated case would only apply for the first well given the potential for coal and shale influx into the wellbore. The remaining wells will have liners run regardless of the results in order to provide a stable wellbore configuration and flexible pumping options to maximise the drawdown of all zones.

Underreaming will be conducted over those intervals which are modelled to benefit following the flow test results during air drilling. The operational process would involve underreaming the wellbore out to 72” across the selected intervals with air and water. If there is difficulty getting returns to surface from the large cavities, a foam system may be used and circulated clean prior to liner installation. A PCP completion with an automated pump-off controller would then be run with a workover rig.

DATA ACQUISITION

Core Data

Nil - core data was obtained from the Rowallon 14 corehole.

Wireline Logging

GR and density-neutron readings for correlation with the comprehensive log suite obtained at Rowallon 14.

Testing

A number of flow tests will be conducted at different points during air drilling in order to evaluate the influx of each package.

Once the wells are completed they will need to be flow tested to evaluate the feasibility of PL application. Given the coreholes confirmed gas saturated packages with good permeability it is expected that gas production would be immediate upon penetration.

RATES AND RESERVES

The production wells are located in close proximity to the Rowallon 14 core well, providing a good estimate of reservoir properties such as net coal and gas content (although measurement is still in progress). At Rowallon 14 DST information was obtained across Juandah and Proud intervals providing permeability and skin estimates. The interpreted permeability values were quite good ranging from 20 to 200mD between seams, but was associated with high skin values (50 to 100). For economic purposes, it is assumed that drilling with air and using formation water whilst running the liner will give skin values of 10 on production for each zone (with the same interpreted permeability values).

There is greater uncertainty of Taroom properties given the intervals were not drill-stem tested, resulting in a relatively large range between the P90 and P10 scenarios. A key upside on OGIP for the wells is the potential to produce gas from the carbonaceous shales which are substantially thicker than the coal packages in the three coreholes. Production from Pleasant Hills 8A suggests a carb-shale component, which is further supported by desorption testing of core samples taken from the coreholes.

The range of expected rates and reserves is given in Table 1 below:

Predicted Well Rates and Reserves

Headline Rate GIP ReservesMMscf/

dTJ/d Bcf Bcf PJ

P10 (High Side) 1.75 1.78 3.3 2.15 2.18P50 (Best Estimate)

1.02 1.03 1.9 1.1 1.12

P90 (Low Side) 0.32 0.33 0.9 0.35 0.36

Notes: (1) Yield – 1.015TJ/MMscf.(2) Yield was based on Pleasant Hills 1A compositional gas analysis.(3) Assumes 15Mscf/d for PCP fuel gas and 3% of sales gas for plant compression.(4) The reserves figure listed includes the component of fuel gas and tariff.

The well rates and reserves were estimated from a FAST CBM model with inputs based on the reservoir parameters ascertained from the Rowallon 14 corehole and estimates for the remainder. The reservoir simulation does not include a shrinkage model given the lack of production data from the coals in the region. This may prove to be conservatism in the model and may reduce the rate of decline on production.

Well Locations (GDA94)

Well_Name Longitude Latitude Long_Dec Lat_Dec Easting Northing Loc RefCoxon Creek 2 149 5 38.00 -26 20 50.5 149.094167 -26.347222 708988 7084167 Coxon Ck 1Coxon Creek 3 149 5 46.15 -26 21 50.01 149.096156 -26.363894 709156 7082317 Coxon Ck 1Coxon Creek 4 149 5 9.43 -26 20 59.76 149.085956 -26.349933 708163 7083880 Coxon Ck 1Coxon Creek 5 149 5 40.97 -26 21 19.05 149.094425 -26.355147 708899 7083289 Coxon Ck 1

Attachment: Well Models and Proposed Production – Probabilistic Model Inputs

Fast CBM Probabilistic Analysis - Rowallon 14A:

Temp Pi Permeability (mD) Area (Acres) Height (ft) phi Swi GC (scf/t) density Pwf Ash

(degF) (psia) Model Mean SD Model Mean SD Model Min Mode Max (%) (%)Constant (DAF) (g/cc) (psia) Skin (%)

DST 2 88 215 Lognrm 120 45 Lognrm 270 220 Triang 13.5 14.5 30 2 30 96.2 1.45 60 10 29DST 3 94 269 Lognrm 50 30 Lognrm 260 220 Triang 5.5 7 28 2 30 133.1 1.45 60 10 29DST 1 95 309 Lognrm 35 15 Lognrm 150 80 Const 3.3 10 15 60 10Upper Taroom 99 423 Lognrm 45 55 Lognrm 200 150 Triang 9 10 27 2 40 139.3 1.55 60 10 29Lower Taroom 100 500 Lognrm 12 8 Lognrm 150 80 Triang 8 10 25 2 70 153.5 1.55 60 10 29

Constant Pwf – model limits FBHP to a single value.Triangular height distributions to capture potential carb shale upside.Abandonment rate of 20 Mscf/d used for simulation (although economic cut-off will be reached prior). No shrinkage effect has been used in the forecasts.

Attachment: Well Models and Proposed Production – Forecast Production

Rowallon 14A Proposed P10, P50 and P90 Gas Production

1600 2200

14002000

1800

12001600

1000

800

600

1400

1200

1000

800

P50 Gas Rate

P90 Gas Rate

P10 Gas Rate

P50 Cum. Gas

P90 Cum. Gas

P10 Cum. Gas

400600

Rat

e (M

scf/d

)

Cum

ulat

ive

Gas

MM

scf

400

200200

02006 2011 2016 2021 2026 2031 2036 2041

2046

Date

GENERAL DRILLING PROCEDURES

INTRODUCTION

This document outlines the various steps in the drilling operation. A separate document, the ‘Santos Onshore Australia Drilling Operations Manual’, summarises the Santos General Operating and Well Control Procedures, drilling equipment and other procedures. This ‘Drilling Programme’ is to be read in conjunction with the above mentioned ‘Drilling Operations Manual’.

WELL COXON CREEK 2 COXON CREEK 3

COXON CREEK 4

COXON CREEK 5*

TYPE Pilot Production Well

LATITUDE 26O 20’ 50.50” SGDA 94

26O 21’ 50.01” S 26O 20’ 59.76” S 26O 21’ 19.05”S*

LONGITUDE 149O 05’ 38.00” EGDA 94

149O 05’ 46.15” E 149O 05’ 9.43” E 149O 05’ 40.97”E*

LICENCE ATP 336P

PRIMARY TARGET

Juanda & Taroom Coal Measures

RIG Mitchell 151 (RT = 4.0 m)

ELEVATION GL 378.4 mRT 382.4 m

GL 375.7 mRT 379.7 m

GL 391.4 mRT 395.4 m

GL* 368.2 mRT* 372.2 m

*Well location details to be confirmed after lease construction and final survey.

The 2006 Coxon Creek drilling campaign in ATP336P Roma is targeting coal seam gas in the Juanda and Taroom coal measures; up to 4 wells are planned for this campaign. This generic programme provides the general drilling information for the campaign, for specific well details please refer to the individual montages.

A 17-1/2” surface hole will be mud drilled to +/- 10 m below top Westbourne formation (approx ~65 m) and cased with 13-3/8” 54.4 lb/ft K-55 BTC casing. See individual montages for exact depth of surface casing.

A 12-1/4” intermediate hole will be mud drilled vertically to ~60 m into the Springbok Sandstone (20m above the Juanda Coal Measures) and cased with a string of 9-5/8” 36 lb/ft K-55 BTC casing.

An 8-3/4” production hole will be air/mist drilled vertically through the target coal measures taking a series of flow tests along the way to TD at the top Eurombah formation. The hole will be logged.

Depending on the results of the flow tests:

The coal seams may subsequently be under reamed to 72”. A mixed 7” 26 lb/ft L80/K55 BTC perforated/plain liner may be sat on bottom in

open hole.

The drilling rig will run a kill string of 2-7/8” 6.5 lb/ft J55 NUE tubing to the 9-5/8” shoe or to the top of the 7” perforated liner.

All logs and reporting for the wells are to be presented in metres.

Well Sequence

The order for drilling of the Scotia wells will be:- Coxon Creek 2- Coxon Creek 3- Coxon Creek 4- Coxon Creek 5

SECTIONAL SUMMARY

1. Pre-Spud

1.1 Operation

1. Check the lease layout for correct conductor pipe, sump and waste pit locations and that mouse hole depths are adequate. Seek feedback from sub-contractors regarding difficulties or peculiarities noted during pre-spud construction (hard drilling, shallow unconsolidated sands etc.).

2. Move rig to location and rig up.3. Ensure rig is levelled and centred over conductor pipe.4. Inspect the rig and ensure it is ready to spud. Complete the pre-spud inspection

form DMS Form F-199.5. Treat out hardness of mix water prior to mixing mud. Start pre-hydrating gel as

soon as possible as per the mud programme.6. Ensure all the instrumentation and Geolograph are functioning and

recording accurately.7. Verify all pre-spud tubular, chemical and equipment deliveries against the

transport documentation. Check well head equipment suitability with particular attention to the correct location of the packing injection and test ports.

8. Hold pre-spud safety meeting.

1.2 General Notes

Adhere to Queensland waste segregation and handling procedures. Racelog Pty Ltd will be providing Waste Removal Services and Industrial Rubbish

Bins. Contact John Gordon (0428 221 367) or Brett Gordon (0427 221 367) when bins require removal. Office number (07) 4622 1367.

Rig water source will be: Stakeyard Bore - mud mixing Stakeyard Bore - cementingPotable water - shower, drinking and cooking water

2. 17 1/2” Surface Hole

2.1 Operation

1. Spud well with the rerunable 17-1/2” MT bit, 8” and 6-1/2” collars, NMDC and pendulum BHA and spud mud using the short system as per attached mud programme.

2. Ensure a float valve is installed correctly in the bit sub.3. Survey with Totco at TD. Line up the trip tank to monitor the well while taking

surveys.

Hole Section TD17-1/2” Surface Hole ~ 10 m MD below top Westbourne formation

4. Maintain hole deviation to < 3 deg.5. Ensure KCl > 3% at all times. Clean hole with high viscosity sweeps as

required, pump regular LCM sweeps to reduce losses if required. Conduct wiper trip prior to reaching TD if necessary.

6. Check bottoms up sample and drill at least 10 m into competent siltstone/clay stone formation.

7. Space out to land casing ~ 1 - 2 m off bottom. Condition mud thoroughly to ensure minimal dehydration of mud when later running surface casing. POOH.

2.2 Hazards & General Notes

The Gubberamunda sandstone is potentially an over pressured aquifer and may require weighting up to drill through, however it is unlikely to be over pressured this far North.

A high viscosity mud will be required to clean the hole due to the poor annular velocity with this hole size and pump capabilities. Pump sweeps as required.

3. 13 3/8” Surface Casing

3.1 Operation

1. Hold pre job safety meeting.2. Rig up and run 13 3/8” surface casing. Thread lock single joint shoe track.

Size Casing Depth13 3/8” 54.4 lb/ft K55 BTC Surface – TD (~ 65 m MD)

3. Top up casing with mud each joint.4. Break circulation in stages on the way to bottom to minimise surge pressure on

the formation.5. Wash last joint to bottom, circulate, land and cement casing.6. Pump pre-flush and additives as specified in attached cement programme.7. Use potable water (or good quality bore water) for cementing. Cement excess

of 50% is programmed.

Cement Cement Top Top DepthSingle Slurry Surface 4 m (Ground level)

8. Displace cement with water using Halliburton. Ensure barrel counter zeroed prior to commencing displacement. Do not displace more than theoretical casing volume plus half the shoe track volume. If bump observed, increase pressure to 1500 psi for 10 mins to test casing.

9. Perform top-up job (30 sx, with 2% CaCl2) using the 1” stinger if no returns or if cement sags while WOC.

10. Wait on cement until surface samples have set.11. Nipple up and function test BOP. Use the plug tester to pressure test lower

Braden head connection (200 psi low/1500 psi high). [DOM 10.5 ‘BOP System Testing’]

12. Pressure test casing to 1500 psi prior to drilling out, if plug did not bump.13. Run wear bushing.

3.2 Hazards & General Notes

Braden head is 13-5/8” 3k x 13-3/8” BTC Pin. Ensure that all the BOP’s, drilling spools, adaptor flanges, rotating head and wellhead components for all hole sections are measured and that the correct space out for the 13-3/8” surface casing is calculated prior to running casing.

Ensure adequate precautions are taken to prevent objects falling into the well.

4. 12 1/4” Intermediate Hole

4.1 Operation

1. RIH picking up 12-1/4” MT bit and packed BHA with float valve.2. Drill shoe track using water initially and converting over to mud system while

drilling the new formation.3. To minimise hole washout near the shoe use moderate pump flow rates (2/3

programmed rate) until the stabilisers are comfortably buried in new hole. Increase accordingly if bit balling becomes apparent.

4. Drill 12 1/4” hole with a MSS survey at TD.5. Drill to TD, make a wiper trip back to the old hole (or surface casing shoe if not

wiped by TD), survey and POOH.

Hole Section TD12 1/4” Intermediate Hole ~60 m in to Springbok Sandstone

Ensure the trip tank is lined up and circulating across the well and trip sheets are used.

4.2 Hazards & General Notes

Keep mud weight as low as possible, but be prepared to raise mud weight to stabilise hole conditions.

Prevent re-grinding of solids by optimising shaker screen selection across all shakers.

5. 9 5/8” Intermediate Casing

5.1 Operation

1. Fully retract the tie down pins and pull the wear bushing.2. Rig up and run the following 9-5/8” casing with a single joint shoe track and

float shoe on the first joint. Thread lock the shoe track.

Size Casing Depth9 5/8” 36 lb/ft K55 BTC Surface – TD (~160 m)

3. While running casing top up each joint and fill every 5 joints. Break circulation at the shoe and elsewhere as necessary to displace gelled mud in stages (if present).

4. Wash last joint to bottom and cement casing.5. Cement is programmed to surface. Cement excess of 25% is programmed.6. Use potable water (or good quality bore water) for cementing.

Cement Cement Top Top DepthSingle Slurry Surface 4 m (Ground level)

7. Drop cementing plug and displace cement with water. Use Halliburton pumps to displace and bump plug.

8. Pump plug to bump.9. Measure displacement via Halliburton computed volume pumped (ensure

counter zeroed prior to commencing displacement), dipping the supply tank and counting Halliburton displacement tanks. Record all three final displacement volumes on the Casing and Cementing Report. Pressure test casing to 1500 psi for 10 mins.

10. Bleed off casing pressure and observe casing. If floats fail, do not bleed back more than ½ shoe track volume.

The casing must be continuously observed for pressure bleed off until the cement samples are hard. At the first sign of any U-tubing, the well must be shut-in.

11. If floats are leaking, re-displace until pressure reaches the original bump pressure plus 200 psi to bump plug. Shut well in and hold pressure until cement sets.

12. Monitor shut in pressure and ensure it does not rise above test pressure (1500 psi). Bleed off as necessary.

13. Record string weight prior to cementing, at end of cement job and again prior to landing casing.

14. Run manually set slip and seal assembly using hex wrench to apply the specified torque to the compression cap screws.

15. Once slip and seal assembly in place, the annulus valve is to remain open while the cement sets.

16. Cut and trim the 9-5/8” casing stub. Install 13-5/8” 3k x 11” 3k tubing spool and energise the secondary seals. Pressure test seals to 3000 psi. Ensure adequate precautions are taken to prevent foreign objects falling into

the well. Ensure tubing spool tie down bolts are fully retracted.

17. Ensure 11” BOP is dressed with 5” drill pipe rams and fully tested ahead of nipple up. Nipple up double ram 11” 3k BOP, 11” 3k annular, rotating control head and blooie line.

18. Pressure test lower tubing spool connection with plug tester and water (200 psi low/1500 psi high). [DOM 10.5 ‘BOP System Testing’]

19. Pressure test casing to 1500 psi prior to drilling out, if plug did not bump.

5.2 Hazards & General Notes

While running in casing, break circulation at the shoe and more often as required to displace gelled mud in stages if present.

Permission from the Drilling Superintendent is required prior to lifting the BOP’s if the Slip & Seal assembly fails to engage the tubing with the BOP’s in place.

Once slip and seal assembly is in place, the annulus valve is to remain open while cement sets. Ensure valve is closed once the cement is set.

Prior to installation of the tubing spool, a trial run is to be conducted for the installation of the tubing hanger and confirmation of tie down bolt extension lengths. The length of bolt protruding from the flange when the tie down bolts are correctly secured should be noted and cross checked later when the hanger is actually set in the well head. (Refer to Safety Instruction 1 – Drilling Instructions from the Queensland Department of Natural Resources and Mines).

Ensure the rotary table and wellhead are covered at all times to prevent debris falling and entering the well.

6. 8 3/4” Production Hole

To impart as little damage on the formation as possible, air will be the major circulating medium for drilling the 8-3/4” production interval of this well. The intent is to drill the section completely with air, log the hole and complete the well barefoot using a 2-7/8” tubing string run without mudding up the hole. This of course depends on the section being drilled without encountering any fluid inflows.

If water is encountered, then it will be necessary to mist or mud up to continue drilling. In this event logging will be undertaken with the well filled with fluid.

6.1 Air Drilling

One of the most important aspects in air drilling is constant monitoring of drilling pressure. A minimum of two pressure measuring stations is required to properly monitor air pressure. One pressure recorder should be on the rig floor, and the second recorder should be immediately downstream of the air compressors. These gauges will allow easy calculation of air volume output at any time. This is very important because should pressure change without an associated change in air volume, trouble is indicated.

It is absolutely necessary to have air circulating around the bit with the bit off bottom before drilling is started. This prevents initial cuttings build up, which is a significant cause of stuck pipe. Because air, unlike mud, is compressible, a period of time is required to establish air around the bit after a connection is made. Circulation around the bit is established if there are returns coming from the blooie line and the air pressure has reached the normal drilling pressure. Drilling should not begin after a connection until both of these two conditions are met.

In order to prevent the drilling string from becoming stuck as a result of pulling into and packing dry cuttings, never pull on the string without air circulation. The air will keep the cuttings moving and allow them to work past the drill string.

6.2 Air Requirements

The minimum air requirements for 8-3/4” hole is in the order of 1300 scf/min at 400 m, assuming an ROP of 90 ft/hr. Refer to the attached Minimum Required Air Flow Rate chart for guidance on the minimum air flow rate required at a given depth and ROP.

No upper limit has been established for air drilling. In general, there is no such thing as too much air available. On the other hand, the reason air drilling fails is very often due to insufficient air volume to clean the hole efficiently under a varied range of drilling conditions. A good rule of thumb to indicate whether enough air is being used is to stop drilling and measure the time for the dust to stop or clean up at the end of the blooie line. Ensure there is no risk of packing off the hole while this is done. The time

required to clean the hole should not greatly exceed one minute per 1000 ft of depth. A sure way to know what air volume is being pumped is to actually measure the air output at drilling pressures. This is done by holding back pressure on the compressor (100 – 200 psi) and measuring the output volume with an orifice flow tester.

When formation water production can’t be dried up or hydrocarbons are encountered, foam or mist drilling is necessary. Mist drilling will require approximately 30% to 40% more air than dusting. Standpipe pressure will be greater. Mist drilling pressure will range from 200 – 400 psi as compared to 100 – 300 psi for dust drilling. The additional air volume and pressure are required because of the weight of the water being lifted.

Drill cuttings not removed fall back and bridge when connections are made. When this condition exits, several things can be done:

1. Add more air volume.

2. Sweep the hole with a foam slug just prior to making a connection. An increase in foam concentration will create a stiffer foam which can better clean the hole and remove the heavier drill cuttings and;

3. Always blow the hole until the return air (and mist) are clean and pressure is stable or dropping prior to making connections. These procedures can eliminate a stuck drill string.

6.3 Flow Testing Notes

Once the well is unloaded to air prior to drilling ahead, perform a calibration check of the flow meter to assess its reliability. Obtain a stabilised air flow rate through the orifice plate on the choke manifold and cross check this with the reading on the compressor (flow meter) side. Check the readings at a variety of air flow rates.

The DST’s performed during the preliminary coring work done at Rowallon 14 (Coxon Creek 5 site) last year indicated the gas was dry; however there is uncertainty with the formation between these points.

If water becomes apparent while drilling, first thoroughly blow dry the well before each flow test. As the annulus starts to load up during the tests, flow is then likely to decrease. At the conclusion of the test, blow the well dry and record observations of any water returned (attempt to quantify if possible).

Copy all flow test results and observations as soon as they are available to Mark Casey (Reservoir Engineer). This information is required for reservoir modelling purposes.

6.4 Operation

1. Do not run the wear bushing. RIH picking up 8-3/4” TCI bit (without nozzles), float sub with float, bit sub with float, NMDC (with Totco ring) and slick BHA.

2. Ensure the float valves are installed and in good condition. These are necessary to prevent the back flow of cuttings into the drill string while making a connection and to prevent gas flowing up the drill string while making a trip.

3. Prior to drilling out the shoe, mud tanks, water tanks and turkeys nest at well site and water bores should be full. Run the primary jet and check suction on the rotating head.

4. Drill shoe track and 3 m of new formation using water and circulate clean. Pull back.

5. Perform a formation integrity test with water as per procedure [DOM 9.7.4 ‘Formation Strength Tests - Procedures’]. Eastern Queensland generally has a characteristically high leak off. We will not pump to leak off, a formation integrity test (FIT) should be conducted to a maximum EMW of 17.2 ppg.

Leak Off Test EMW CommentMinimum FIT 17.2 ppg Give 20 bbl kick tolerance with 8.3 ppg fluid

and the shoe at 160 m.

6. Bring air package on line and unload the well.7. Perform calibration flow test as detailed in the Flow Testing Notes above.8. Drill 8-3/4” hole preferably with air only. Adjust the air flow rate as per drilling

process requirements.9. Introduce the mist pump (at 5-15 bbl/hr) at the first indication of water or

hydrocarbons.10. Conduct flow tests according to the flow test schedule attached.11. Drill 8 3/4” hole with MSS surveys every 150 m to TD. The survey frequency will

be increased if there is a noticeable deviation tendency > 3 degrees.12. Drill to TD.

Do not drill in to the Hutton formation (aquifer).

13. Survey and POOH ensuring gas is being drawn down the blooie line.

Hole Section TD8 3/4” Production Hole Top Eurombah formation

14. Ensure the wireline logging crew have a complete set of fishing gear on site with correct cross-overs to rig pipe and they are fully aware of all tool and hole dimensions.

15. Open choke line and close blind ram BOP to direct gas flow to the flare line.16. Rig down rotating head and rig up adaptor flange, riser, surface valve, wireline

BOP, lubricator with bleed off valve and stuffing box.

Note: If the well is loading up with water naturally the well may be killed and logged conventionally. In this case it is desired to leave as much of the natural formation water spotted over the coals as possible. Attempt to POOH above the coals before circulating drilling water around the hole.

17. Rig up and run wireline logs [DOM 9.3 ‘Electric Logging'] as per instructions from Santos Wellsite Geologist and accepted by the Rig Representative and Drilling Engineer.

18. Rig down loggers.19. If the well remains dry, the well will be completed barefoot.20. Prepare to run completion.

Alternatively, under ream selected coal seams, run a mixed 7” perforated liner on bottom or P&A. Wellsite Geologist to advise course of action after consultation with the Project Team.

6.5 Hazards & General Notes

Air Drilled Hole Sections

Do not obstruct the Driller’s view of the air package. No one apart from the Driller is to signal the Airpack Operator, except in

an emergency. (On this rig it is likely the air compressors will be controlled by the Driller).

All crew to wear appropriate PPE including safety glasses at all times.

1. Driller signals Airpack Operator to throttle up compressors and booster and ensures flow through standpipe, bleed off, primary and secondary jets.

2. Use air compressors and booster to unload drilling fluid from the hole. Run the pumps at slow rate with air on whilst diverting flow to the mud tanks. Once aerated mud is seen at the surface, divert whole flow to blooie line and shut down the mud pumps. Blow hole dry with the maximum air available in order to clean any scale from the drill string.

3. Mist pump is to be brought on line only when directed by the Santos Representative on site.

4. Monitor standpipe pressure and air flow rate to ensure drilling optimisation. This includes ensuring good returns at the blooie line, making sure standpipe pressure does not fluctuate and watching for any changes in the ‘normal’ operations.

5. If there are any changes in ’normal’ operations, Driller will immediately alert Airpack Operator and the Santos Representative. Some easily identified changes in ’normal’ operations are outlined in the table below.

Symptom Problem SolutionSlowly increasing pressure.

Poor hole cleaning. First advise the Santos Representative on site. Pick off bottom and work pipe for a few

minutes. Increase misting rate (if in use).

Sharp increase in pressure then stabilisation.

Well kicking Stop rotating. Pick up until tool joint is clear of

rotating table. Advise the Santos Representative on

site.

Rapid increase in pressure.

Bit or float plugged. Back surge via secondary jet. Trip for bit.

Slowly decreasing pressure.

Loss in air pack capacity.

Check with air pack operator.

Washout in drill string. Advise the Santos Representative on site.

Rapid decrease in pressure.

Twist off. Stop drilling and advise the Santos Representative on site.

6. If required, the well should be killed using the dynamic kill method.

Hazards

The continuous gas monitor and hand held gas detectors are to be rigged up and functioning.

Closely monitor gas values on connections. Blooie line pilot light to be running at all times.

Ensure compressor is running at all times to prevent flashback down the blooie line when circulation stops.

The provisions of the Air Drilling Procedures must be observed during all air drilling operations.

The string will not have a profile sub in the BHA. If the double float system fails to hold pressure it will therefore be necessary to kill the well to trip out of the hole.

Water gradient pressure or less expected to TD. Juanda pressures ~250 psi (8.2 ppg EMW) Taroom pressure ~ 420 psi (7.2 ppg EMW)

A minimum of two hole volumes of kill weight mud should be kept from the upper hole and be available at all times.

Santos will provide two Rig Representatives during the air drilling phase to allow 24 hour coverage.

The air compressor must be running and directing air to the primary jet at all times when air is not being circulated down hole (i.e. When on connections)

The area at the end of the blooie line must be barricaded and all work in this area will require a Permit to Work. The “buddy system” is to be used for work in this area.

It is planned to trip the drill string and BHA using the primary jet and by stripping through the rotating head rubber without killing the well, unless this is deemed unsafe by Santos Rig Representative. The rotating head rubber should be in good condition and if necessary the rubber should be replaced prior to resuming drilling. The procedure for tripping while stripping through the rotating head rubber is detailed in the Air Drilling Procedures.

The Santos Rig Representative shall have the authority to kill the well with water any time he considers it prudent as a result of high flow rates or any other reason causing safety concerns.

The maximum flow rate for safe tripping without killing the well is dependant on a number of factors including the efficiency of the primary jet. In general tripping out without killing the well should not be undertaken at rates above approx. 5 mmscfd without the approval of the Drilling Manager. A program change control form must also be completed for any variations to this program. Flow rates of this order are not expected in this well.

If flow rates exceed approximately 15 mmscfd then drilling shall not continue without the approval of the Drilling Manager. A program change control form must also be completed. See Attachments for estimated pressure loss in blooie line at various flow rates.

A Wood Group Field Engineer or a suitably trained and competent Rig Representative must be on site to supervise the activation of the hold down screws while landing the tubing hanger in a live well.

7. 72” Under Reaming

In these wells we may again be trialling the application of a large diameter open hole under reaming tool. The goal here is to create a larger well bore that intersects a greater number of coal seam fractures and thereby increase the productivity of the relevant seam.

Water will be used as the circulating fluid whilst underreaming.

7.1 Operation

1. Confirm number, depths and intervals of coal seams to be under reamed.2. Pick up the Harvest under reamer tool and BHA with float valve noting the pivot

point of the under reamer blades.3. RIH the lowest target coal seam and space out to set the blade pivot point at

the top of the seam interval.4. Bring circulation to acceptable level and commence rotation with revs and a

torque setting at or below the maximum amounts for the tool in use. Do not exceed make up torque of drill pipe. The under reamer activates (opens) primarily by rpm. Higher rpm (140 – 150 rpm) has been required in the Scotia trials to initially open the under reaming tool and to cut the initial ledge in the formation.

5. Initial returns are expected to be quite fine in size with amount of returns increasing with time. Monitor the volume of returns from cutting the initial ledge as an indicator of when the blades are fully open. Volume of returns expected from a ledge cut out from 8-1/2” hole to 72” hole

~ 55.4 ft3 (geometric volume only without formation expansion considered)6. Once a ledge is cut and the blades are fully open start moving the drill string

downwards with caution to engage the lower side cutters. Very little weight is required (1000 lbs) as the revs do most of the cutting. Keep a close eye on the torque as too much weight set down on an open tool may stall the rotation. Do not exceed the makeup torque of the drill pipe. RPM, circulation rates and drill string weight should be adjusted to allow for the best ROP but should not exceed the recommended numbers for the tool. Max torque 5000 ft-lb Max weight 5000 lbs

7. At under ream TD thoroughly circulate the hole clean while passing the tool up and down the cavity several times.

8. Position the tool well above the cavity’s lower edge. Stop rotation and allow the blades to retract back inside the tool’s body.

9. POOH to position the blade pivot point at the top of the next interval to be under reamed. Repeat the steps noted above as required to under ream the coal seam.

7.2 Hazards & General Notes

Driller’s must not be aggressive with this tool. We can not risk bending the under reamer arms. This could result in a failure in the arms to neatly close back inside the tool causing difficulties POOH or tool arms to break off again.

Take care handling the under reaming tool on surface – the reamer arms are heavy and may swing out when the tool is lifted.

8. 7” Perforated Liner

If the well is producing fluid or is likely to over the life of the well, a pump will have to be run later on for dewatering. To provide a protective sump for this, the rig will run a mixed perforated/plain 7” liner string across the open hole. This will sit on bottom.

Any pumping equipment will be run by a work over rig at a later date.

8.1 Operation

1. Cut a saw tooth profile on the pin end of one joint. This is to provide a form of torque anchor for the string when on bottom.

2. Fit a centraliser with a stop rig to the first joint ~3 m from the shoe.3. Run the following mixed 7” casing according to the proposed liner

configuration plan included in the attachments. The exact tally may change slightly on the day only so far as the spacing or

location of the short joints. Use the casing pup joints to space out the perforated joints across the coal

seams.

Size Casing Depth7” 26 lb/ft L80 BTC (perforated) 26

lb/ft K55 BTC (plain)One joint inside 9-5/8” shoe – TD

4. Fit metal petal baskets (without stop rings) to the joints directly above the perforated sections.

5. Run sufficient joints to place the top of the liner approximately 1 joint inside the 9-5/8” casing shoe.

6. Make up the back off landing sub and running tool to the top joint of casing.7. Run the liner string in the hole on drill pipe and land on bottom.8. Apply right hand rotation to the string to back out the running tool from the

landing sub. POOH.9. Proceed to run

8.2 Hazards & General Notes

It will not be possible to ‘wash down’ the perforated liner. Ensure the hole is clean and in good condition before POOH to run the liner.

Discuss and agree on in the actions that will be taken in event of a well control situation, keeping in mind the complications introduced by having an open ended perforated string of casing in the hole. Ensure there is a plain joint of casing at the ready that can be stabbed in, lowered and the BOP closed.

Ensure the trip tank is running over the hole and good hole volume records are maintained.

9. Completion

Ensure the procedure for changing out the pipe rams to 2-7/8” is thoroughly reviewed prior to implementation. Have backup seals and/or tubing hanger available on site.

9.1 Operation (Live Well)

Ensure the Completion Running and Landing Procedure is reviewed and discussed amongst all parties well before the completion is run in the hole.

1. Flow well through the blooie line. Install a second 2-1/16” valve to one of the tubing spool side outlet valves and rig up lines to provide an additional flare line.

2. Make up the following completion string (from bottom to top) and RIH: A 2-7/8” NUE collar (wire line re-entry guide). Pre-tested 2-7/8” XN nipple assembly with installed PXN plug. One full joint of tubing. 2-7/8” X nipple assembly with installed PX plug.

The XN profile assembly must be located below the X profile assembly.

3. Run the following 2-7/8” tubing.

Size Tubing Depth2-7/8” 6.5 lb/ft J55 NUE Surface – 9-5/8” casing shoe

4. Install the BPV and pressure test to 3000 psi (if not done previously). Test from below the BPV. Make up the tubing hanger.

2-1/2” nominal BPV will not run or pull through the 2-7/8” handling joint.

5. Make up the specially marked landing joint.6. Open the choke line and flare line valves to divert flow through the tubing spool

side outlet valves.7. Land tubing hanger and fully engage all tie down bolts to lock the hanger in

place. Check the tie down bolt lengths and confirm the length of bolt protruding from the flange is appropriate for a correctly landed tubing head. Make up tie downs and gland nuts to correct torque. Wood Group Field Engineer or a suitably trained and competent Rig Representative is to confirm this (as stipulated in Safety Instruction 1 – Drilling Instructions from the Queensland Department of Natural Resources and Mines).

8. Close 2-7/8” pipe rams and pressure test tubing hanger seals from above to 3000 psi.

9. Remove the landing joint.

10. Nipple down BOP. Install Tubing Spool Adaptor Flange and Christmas Tree.11. Pressure test hanger neck seals and top tubing head flange to 3000 psi via the

½” test port.12. Release rig.

Mouse hole to be carefully and slowly filled to avoid bridging.

9.2 Operation (Dead Well)

1. Thoroughly wash inside of well head.2. Make up the following completion string (from bottom to top) and RIH:

A 2-7/8” NUE collar (wire line re-entry guide). 2-7/8” XN nipple assembly (no plug)

3. Run the following 2-7/8” tubing

Size Tubing Depth2-7/8” 6.5 lb/ft J55 NUE Surface – top 7” liner

4. Install Christmas Tree and test as noted above.5. Release rig.

10. Abandonment

If it is decided to abandon the well, formations to be isolated must be confirmed with Ops Geology post logging operations, and be in accordance with the requirements of the Santos Onshore Australia Drilling Operations Manual Chapter 11 ‘Suspension and Abandonment’.

10.1 Operation

1. RIH with 150 m of 2-7/8” cement stinger on drill pipe and set abandonment plugs as per programme.

2. Tag shoe plug with 10klbs. Shut annular and pressure test to 500 psi above the leak-off pressure recorded at the surface casing shoe. POOH and lay down drill pipe. Pull wear bushing.

3. Nipple down BOP’s and remove Braden head.4. Set surface cement plug. Install identification plate and release rig.

10.2 Hazards & General Notes

All plugs to be set on a 30 m hi-vis pill (Min YP=50). Minimum plug length 100 m. All plugs 15% over calliper or 25% over gauge hole. Use final depths from wireline logs.

PROGRAMME SUMMARY

1. BIT and BHA Summary

Bit No. #1 #2 #3 #4Bit Size in 17 1/2” 12 1/4” 8 3/4” <= 72”IADC Code 117 117 417 PDC

Bit Type XR+C TD41XM Under Reamer

Manufacture Smith Reed HarvestDepth In m 0 ~65 ~150Depth Out m ~65 ~150 ~400Hours 5 5 12Metreage m 65 85 250Cumulative hrs 5 10 22ROP m/hr 15 20 20 1RPM 70-110 70-110 60-70 70-790WOB k lbs 30-75 10-45 15-45 1Nozzles 3 x 20, 20 3 x 15, 13 OpenTFA in2 1.22 0.64Jet Velocity m/sec 56 76Pump Output gpm 700 500Pump Pressure psi 738 857SPM (6” liners) 7” stk 280 200 120Ann. Velocity m/min5” DP 19 305” HWDP 19 306 ½” DC 20 358” DC 22 43 -Pressure @ bit % 33 57Bit HSI Hhp/in2 0.46 1.22

These values are for guidance only. Operational parameters may by varied to suit operational needs.

MDC 151 has the capability to provide additional WOB from the top drive unit due to the pull down capability of this hoisting system. This may need to be applied during surface hole to get adequate penetration rate where there are insufficient collars in the hole to give good WOB.

BHA No. 1 2 3 4Type 17 1/2” Pendulum 12 1/4” Packed 8 3/4” Air 72” Under ReamerBit size 17 1/2” MT 12 ¼” MT 8 ¾ TCI 8 ¾” TCI

BHA Bit Sub with Float 12 1/4” NB Stab with Float

Float Sub with Float Bit Sub(4 1/2” Reg B x 4” IF B)

2 x 8” DC 1 x 8” DC Bit Sub with Float 1 x 6 ½” DC

17 1/2” String Stab 12 1/4” String Stab 6 ½” NMDC X/O(4” IF P x 3 ½” Reg B)

X/O(6-5/8” Reg P x 4” IF B)

1 x 8” DC 8 x 6 ½” DC 72” Under Reamer(3 1/2” Reg P x P)

6 ½” NMDC 12 1/4” String Stab 6 ¼” Jar Bit Sub with float(3 1/2” Reg B x 4” IF B)

4 x 6 ½” DC X/O(6-5/8” Reg P x 4” IF B)

2 x 6 ½” DC 8 x 6 ½” DC

6 ½” NMDC X/O(4” IF P x 4 ½” IF B)

6 ¼” Jar

8 x 6 ½” DC 3 x 5” HWDP 2 x 6 ½” DC

6 ¼” Jar 5” DP X/O(4” IF P x 4 ½” IF B)

2 x 6 ½” DC 3 x 5” HWDPX/O

(4” IF P x 4 ½” IF B)5” DP

3 x 5” HWDP

5” DPMaximum Available WOB(85% buoyedweight)

17 klb*(8.6 ppg MW)

25 klb(8.6 ppg MW)

26 klb (Air)

2. Casing & Centraliser Programme

Conductor Surface Casing Intermediate Casing

Production Liner

Hole Size - 17-1/2”(445 mm)

12-1/4”(311 mm)

8-3/4”(222 mm)

Casing Size 20”(508 mm)

13-3/8” (340 mm)

9-5/8” (245 mm)

7”(178 mm)

Setting Depth 5.7 m ~65 m ~160 m - 400 mGrade - K55 K55 K55Weight - 54.4 lb/ft

(80.95 kg/m)36 lb/ft

(53.57 kg/m)26 lb/ft

(38.69 kg/m)Connection - BTC BTC BTCMarker Joints - - - Refer to

attachment on proposed liner configuration

Float Equipment

- Guide shoe. Float collar one joint off bottom.

Float shoe.Float collar one joint off bottom.

(liner not cemented)

Wiper Plugs - Top Top and bottomCentralising - Bow spring

3 m from shoe. Middle 2nd joint. 3rd coupling. 2nd coupling

below ground level.

Bow spring 3 m from shoe. Next 2

couplings. 3rd coupling. Over coupling

on every 5th joint.

1st coupling below surface shoe.

1st, 3rd & 5th

coupling above surface shoe.

Cement baskets (without stop rings) on each blank joint above perforated joints

1 bow spring centraliser on the first joint 3 m from bottom

Accessories - 13-5/8” (340 mm)casing head

9-5/8” (245 mm)manual slip and seal assembly

Back off landing sub

Thread Lock - Shoe through to connection above

float collar

Shoe through to connection above

float collarBOP Test Pressure

- 1500 psi(10500 kPa)

1500 psi(10500 kPa)

3. Casing Design

Safety Factors Intermediate Casing

9 5/8” 36 Ib/ft K55 BTC0 – 150 m

Burst (1.1) 2.35Collapse (1.0) 11.63Axial (1.6) 4.28

4. Preliminary Cement Characteristics

Surface Slurry Intermediate Slurry

Cement Type A ACement Top Surface SurfaceDensity (lb/gal) 15.6 15.6Excess (%) 50 35Mix Water (gal/sack) 5.26 5.26Yield (cuft/sack) 1.18 1.18Thickening Time (hrs) ~3:00 ~3:00

Refer to the signed slurry report for final cement characteristics and blend.

5. Preliminary Abandonment Plug Programme

Depth (m RT)

Length (m RT) Purpose Prognosed Formation Tops

1 300 - 400 100 Taroom Isolation Taroom CM 341 m2 90 - 190 100 9 5/8” Shoe Shoe ~160 m3 4 - 14 10 Surface Isolation (if required) Surface 4 m MDRT

Refer to Santos Onshore DOM Chapter 11 ‘Suspension and Abandonment’ for detailed requirements.

6. Wellhead

Braden Head Wood, 13-5/8” 3k x 13-3/8” BTC PinSlip & Seal Assembly Wood, 13-5/8” x 9-5/8”Tubing Spool Wood, 13-5/8” 3k x 11” 3kTubing Spool Adaptor Flange Wood, 11” 3k x 3-1/8” 5kXmas Tree Wood, 3-1/8” 5k

7. BOP Stack Configuration

11” BOP for Production Hole

Component Description DressedRotating Control Head Williams 11” 3000 psi Flanged bottomAnnular BOP GK Hydril 11” 3000 psi Studded top, flanged bottom

Double Ram BOP Townsend LWS 11” 3000 psiStudded top & bottom Top: Pipe rams (5”)Bottom: Blind rams

Mud Cross 11” 3000 psi 2 x 2-1/16” 3000 psi outletsWellhead - Tubing Spool 11” 3k x 13-5/8” 3k 11” API 3000 psi RX53 flange

8. Survey Programme

Hole section 17 1/2” 12 1/4” 8 3/4”

Survey Type & Frequency MSS:

Survey at TD.MSS: Survey at TD.

MSS: Every 150 m to TD. If deviation exceeds 3

degrees, increase survey frequency.

50 mDeviation Sub Surface Target - with respect to well centre at primary target level

9. Sub Surface Targets

WELL NAME: COXON CREEK 2 WELL TYPE: GAS DEVELOPMENT

WELL AREA: ATP 336P

RIG MITCHELL 151m MD LITHOLOGY TOPS & P WELL CASING (RT) TARGETS & SCHEMATIC WELLHEAD

TVD (m RT) A

LATITUDE: 26 deg 20' 50.5" S

LONGITUDE: 149 deg 05' 38.0"

E SEISMIC REF:

ELEVATION: GL - 378.4 m RT - 382.4 m

CEMENTATION DRILLING FLUID

SANTOS Limited

WELL OFFSETEVALUATION DATA WELL INFO.

Time - Depth Curve All depths are in m RT

0

50

100

150

200

250

300

350

400

Gubbermunda

Westbourne

Weald Springbok SS

Juanda Coal

Proud SS

Taroom Coal

Eurombah

53 m

90 m98 m

180 m

233 m

341 m

405 m

430 m

17-1/2"

12-1/4"

8-3/4"

13-3/8"

65 m

9-5/8"

160 m

7" perforated

Well TD: 406 m

SURFACE CASING13 3/8"

54.4 lb/ft K55 BTC

At TD make wiper trip to surface.

1 joint Shoe Track

Surface Casing Shoe+/- 10 m in to Westbourne

Set casing 1-2 m off bottom

Braden Head13-5/8" x 13-3/8" BTC, 3000 psi

Spaced out to fit BOP's and rotating head

under substructure.INTERMEDIATE CASING

9-5/8"36 lb/ft K55 BTC

Surface to top Upper Baralaba CM

1 joint shoe track

Run centralisers and marker joints

as per programme

Make up connections to triangle.

Tubing Spool

11" 3000 psi x 13-5/8" 3000 psi

SURFACE CASING15.6 ppg Class A

Mix Water 5.26 gal/sk, Yield 1.18 cuft/skTop of single slurry to surface

50% excess

Note volume of cement returns to surface

Top Fill: Class A with 2% CaCl2 Perform Top Fill with 1 " Stinger

Displace cement with water using Cmt Unit. Use Potable water (or good quality bore water)

for mix water.

INTERMEDIATE CASING

15.6 ppg Class AMix Water 5.26 gal/sk. Yield 1.18 cuft/sk

Top of single slurry to surfaceUse 25% excess in open hole

Hold safety meeting prior to Cementing

Use Potable water (or good quality bore water)

for mix water.

Preflush with:

40 bbls Water

Displace cement with water using

Halliburton Unit.Ensure the plug has fallen.

Pump to bump on production casing.Record pressure prior to bump.

SURFACE HOLE17-1/2" hole, 0 ft to ~65 m

Spud Mud - Hi Vis (>60) bentonite spud mud in short system.Prepare Pac R / KCl mud in main system

1 ppb Pac R, 3% KCl

Add premixed Pac R / 3% KCl upon entering reactive clays Use Quickseal M directly to system or via sweeps (10 ppb)

for loss control.Keep funnel viscosity high to compensate for poor annular velocities.

Treat losses and condition mud prior to POOH for casing.

MW: < ALAP YP: 20 - 25

Funnel Vis: >60 pH: 9 - 10

INTERMEDIATE HOLE

12-1/4" hole from ~65 m to ~160 m

2% KCl / Polymer MW: ALAP

YP: 15 - 20 pH: 8 - 9.5

KCl > 2% MBT: 7 ppb

Treat recycled fluid from previous section to ensure parameters are within specifications.

Maintain min 2% excess KCl.Monitor cuttings integrity and adjust accordingly.

Prevent re-grinding of drilled solids by optimising (finest) shaker screen selection across all shakers.

Use pill tank to make up high viscosity sweeps of Xanthan gum.

Add prehydrated gel to give filter cake integrity.

Pump 10 ppb Sandseal sweeps to stem losses.

SURFACE HOLE

Mudlogging - As Directed

by Ops Geology

INTERMEDIATE HOLE

MudloggingAs Directed by Ops

Geology.

Coring

Nil

DST

Nil

Wireline Logs

Nil

BHST24 deg C @ 160 m1.9 deg C / 30 m

20"Conductor

set at +/- 6m

Survey at section TD. (MSS)

Assumed Temp Gradient

1.9 deg/30 m + 21

BOP Test 200/1500 psi

Survey at section TD. (MSS)

BOP Test

200/1500 psi

Nearest Offset Wells:Rowallon 14 (core): 0.86 km S

Offset Well Notes

Rowallon 14 (core)

4.5" Untraseal casing to 77.1 mGas kick encountered while coring at 255 m

200 psi shut in pressure. Circulated out through choke to flare pit.Waited on repair of logging equipment (~ 1 day)

DST 1 (246 - 260 m) 1 psi, 1/4" chokeDST 2 (165 - 179 m) final pressure 29 psi, 1/4" choke, 65 Mscfd

DST 3 (218 - 232) up to 30 psi, 1/4" choke, 66 Mscfd P&A

Rowallon 13 (core)

Delayed move due to wet location.

Trucks bogged on access road and lease.4.5" Untraseal casing to 240.9 m

Circulated 8.8 ppg fluid at 555 m (TD) to control background gas.

Initially had trouble with loging software on first run.Swabbed hole on wiper trip prior to DST's with 7 jts to go.

DST 1 (402 - 432 m) stabilised pressure 7 psi, 32 MscfdDST 2 (363 - 385 m) final pressure 3 psi, 1/4" choke, 26 MScfd

DST 3 (313 - 333) up to 45 psi, 1/8" choke, 20 Mscfd before dieingDST 4 (313 - 337) stabilised 15 psi, 1/8" choke, 10 Mscfd

P&A

Rowallon 3 (core)

4.5" Untraseal casing to 238.6 mProblems obtaining core due to standpipe pressure fluctuations,

changed out swabs in the pump.DST 1 (518 - 545 m) no gas

DST 2 (320 - 340 m) no gas P&A

100

200

300

450

500

Hutton DO NOT DRILL IN TO HUTTON

PRODUCTION LINER(Contingent)

7"26 lb/ft L80 BTC (perforated)

26 lb/ft K55 BTC (plain)

PRODUCTION HOLE

8-1/2" hole from ~160 m to ~406 m

Air drilled hole section conducting flow tests as directed.

PRODUCTION HOLE

MudloggingAs Directed by Ops

Geology.

Primary Objectives

Juanda coal measures Taroom coal measures

550

600

650

700

Perforated casing spaced out across coal seams

Cement baskets (without stop ring) on casing above perf joints.

1 centraliser above shoe

COMPLETION TUBING

2-7/8"6.5 lb/ft J55 NUE

Surface to 9-5/8" shoe.

If well live:Run X and XN profile assemblies

with plugs

If well killed:Run XN profile assembly

without plug

Formation Gas Composition

Wireline LogsGR-CAL-Density

Flow Tests As Directed by Wellsite

Geologist.

Refer to flow test points schedule

BHST46 deg C @ 400 m1.9 deg C / 30 m

Survey every 150 m to TD or more frequently

>3 deg (MSS)

Bottomhole Pressures

Juanda ~250 psi (8.2 ppg) Proud ~300 psi (7.6 ppg)

Taroom ~420 psi (7.2 ppg)

Max surface pressure pressure of 308 psi

DO NOT DRILL INTO THE HUTTONThis is an aquifer and the intention is to call TD well above this.

400

5000 2 4 6 8 10 12

Time (Days from Spud)

TARGETS:Primary

No changes to the drilling programme can be made without the Programme Change Control form

Well Objectives: Juanda and Taroom coal measures Rig Move

OPERATION TARGET3.0 Days

Secondary

P & A PLUGS

(if required) Minimum 200' in length. Tagplug across shoeand pressure test 500 psi above leak off

(DQMS-F207) first being signed and sent to the rig.

Water Source: Stakeyard 1 Bore & Pleasant Hills 21

DRILLING HAZARDS: Very low potential for minor over pressure in Gubberamunda aquifer.This is unlikely this far North.

Prepared By: Steven Furze Date: 3 March 2006

REVISION 0

Surface Hole - Drill 17-1/2" hole to ~65 mRun 13-3/8" casing & cement, Nipple up BOP, pressure test Intermediate Hole - Drill 12-1/4" hole to ~160 mRun 9-5/8" casing & cement, Nipple up BOP, pressure test Production Hole - Drill 8-3/4" hole to ~406 m with flow tests EvaluationRun 7" Liner Completion P&A (1 days)

Spud to ReleaseTOTAL (Including rig move)

0.5 Days1.0 Days0.5 Days1.5 Days2.5 Days1.0 Days1.0 Days1.0 Days1.0 Days

9.0 Days12.0 Days