The shares form part of the shortfall shares arising from the one for three renounceable rights issue which closed on 26 November 2001. The proceeds from the placement of the shortfall shares are $769,987.35 and will be used by the company to fund its share of the development program on the SW1A oil producing field in Thailand in which Carnarvon has a 40% interest.

Staying in Thailand, drilling will soon commence on a new well in the Wichian Buri Oil Field within the SW1A concession in central Thailand. The well, known as WB-N3, is expected to spud early January next year and is the first of a series of production wells to be drilled by the joint venture partners in SW1A.