SANTOS South-East Queensland – Case Study

Client Background

Santos is a major Australian oil and gas exploration and production company with interests and operations in every major Australian petroleum province and in the United States, Indonesia, Papua New Guinea, Kyrgyzstan and Egypt.

Santos is one of Australia's largest gas producers, supplying sales gas to all mainland Australian states and territories, ethane to Sydney, and oil and liquids to domestic and international customers.

At year end 2005, Santos had a total market capitalisation of approximately $7.9 billion, making it one of Australia's Top 40 companies.

Project Overview

The Surat and Bowen Basins are located in eastern Queensland. Santos holds interests in a number of permits in this region. Santos produces sales gas and gas liquids from its interests in the Surat Basin and sales gas from its interests in the Bowen Basin.

Santos also operates the 100%-owned producing Scotia coal seam methane field in the Denison Trough and is evaluating coal seam methane potential from its other interests in the Roma Shelf area.

In 2005, Santos acquired Tipperary Corporation resulting in an approximate 75% operated working interest in the Fairview coal seam gas field, located north of Roma in Queensland, together with more than 4,000 sq km of additional exploration acreage in the Comet Ridge area of the Bowen Basin. Mitchell Drilling currently provides all CBM drilling services for Santos in the Bowen and Surat Basins with our 2 Soilmec G102 semi automated top drive rigs and 1 CBM exploration coring rig.

With such a widespread acreage and variety of geological environments, the drilling requirements for our rigs range from large diameter wells 12 1/4 " drilled with a 13 5/8;" BOP stack to 8 1/2 " diameter wells drilled using underbalanced techniques with Mitchell Drilling supplied multiple compressor air packs.