Shareholders at the company's annual general meeting heard that the recoverable reserves depended on a technical fraccing sand process planned for early next year. Mosaic chief executive, Dr Howard Brady, told shareholders that the recovery factor of the Spring Grove fields, near Surat, was still unknown.

"Although comparable fields indicate it could be between 10 and 20 per cent, Mosaic's present interest in the field is 77.5 per cent," he said. Dr Brady added the company was looking to increase income through an additional development well on the Downlands East gas field in 2002.

Directors also told the meeting they aim to develop the company's Churchie gas discovery and Spring Grove oil discovery, both in the Surat Basin, Queensland, within the next 12 months. The Churchie well was 49 per cent-owned by Mosaic and 51 per cent owned by Santos Ltd. Dr Brady said the joint venture with Santos was "going strong" and the companies have a "good relationship".