Anadarko will pay 100% of the well costs to hold an option to take up a 75% interest in AC/P26 within 90 days of the well being completed. Upon Anadarko's election to take up this interest, Indo-Pacific's own interest in AC/P26 will reduce from its present 50% to 12.5%, with West Oil NL holding the remaining 12.5% interest.

Indo-Pacific's interest after this Anadarko farm-in carries the obligation to meet a total 0.35% over-riding well head royalty held by Trans-Orient Petroleum Ltd. In addition Indo-Pacific's equity carries a 0.625% 'carry to production' interest in favour of Lonman Pty Ltd. In the event of commercial production Lonman will repay all carried costs associated with this interest to Indo-Pacific from their share of revenues.

Anadarko will drill the well in AC/P26 after it has drilled two other exploration wells in adjacent permits AC/P27 and AC/P25, in which INDOF holds no interest. The well in AC/P26 is scheduled for the first quarter of 2002, and will test a prospect located between the Anson-1 well in AC/P26 and the Talbot oil field, which lies adjacent and just north of AC/P26.

In the onshore Taranaki Basin, New Zealand both the Kahili-1 and the Makino-1 wells are scheduled to commence drilling this coming weekend.