Beach Energy: January Monthly Drilling Report (Australia)

Beach Energy Limited is pleased to release monthly drilling report ending 2 February 2011.

Beach Operated Cooper-Eromanga Oil – Western Flank

The Ensign 30 rig has finished its drilling commitments with Santos and is currently being demobilised to the Moomba area. Beach will then mobilise the rig to the Western Flank where a two rig, minimum sixteen well exploration and development drilling program is expected to commence with back to back wells on the Parsons Field (Beach 75%) in mid-late February.

Beach Operated Cooper-Eromanga Basin Gas – PEL 106FI Block

Canunda-1 extended production testing will recommence this month after a workover to retrieve wireline and pressure gauges from the well and reconfigure production zones. Local rain has delayed mobilisation of the workover rig and it is now anticipated that testing will recommence in mid February. The evaluation is intended to define size and production characteristics of this high liquids gas field (Beach 50%).

Beach Operated Cooper Basin Shale Gas Exploration – PEL 218

Holdfast-1 (Beach 90%), the second of a two well back to back shale gas exploration program in the Nappamerri Trough spudded on 21 January. The target zone is expected to be intersected in mid to late February. The well will be extensively cored over the Roseneath-Epsilon-Murteree sequence and is expected to reach total depth in late March.

Santos Operated Cooper Basin Oil and Gas Development

During the reporting period the drilling of Coonatie-15 (Beach 20.21%) has been completed with the well cased and suspended as a future gas producer and Tirrawarra-80 (Beach 20.21%) has been cased and suspended as a Patchawarra gas producer. The Ensign 32 rig now moves to the Kidman North-4 location. Ensign Rig-18 continues drilling on the Cook Field (Beach 20%) with Cook-18 cased and suspended as a Hutton oil producer and Cook-16 currently in the evaluation stage.

Beach Operated Geothermal – Paralana Project, Arrowie Basin

Information from the recent diagnostic fracture injection test at Paralana-2 (Beach 21%) is currently being interpreted. Once complete the results will be incorporated into the main fracture stimulation program planned for late in the first quarter.

Beach Operated Gippsland Basin – PRL-2

Gauges have been successfully recovered from Wombat-2 in PRL-2 (Beach earning up to 33.33%) which has been shut in for pressure build up since late December following a two week flow test. The pressure data is currently being interpreted.

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Source: Beach Energy, February 2, 2011;