Sole risk pays off for Mosaic

The gamble to sole risk the Churchie-3 well has paid off for Mosaic Oil as the company has reported a 20 million cubic feet per day gas flow from the well.

Partner Santos had elected not to participate, although was now looking at its options to claw back into the well, which usually carries significant financial penalties.

The Churchie-3 flow was through a one-inch choke at 743 pounds per square inch with associated LPGs and condensate, the details of which Mosaic said it would release when laboratory analysis was complete.

The discovery is one of largest gas flows recorded in the Surat/Bowen Basin area of Queensland and indicated the potential of a virtually untapped Permian province in the company's acreage portfolio.

The chairman of Mosaic Oil Dr Don Stammer remarked: "The Churchie-Noorindoo complex is a company maker that could be worth around $125 million to Mosaic Oil."