Chief executive Rick Webber said Austral was in a sound financial position, despite the two losses, and was well placed to pursue its 2006 business objectives.

“We have two objectives for 2006 at the top of our list - the development of the Cheal oil field and a declaration of commerciality over the Cardiff gas discovery.”

Webber said plans for the development of the onshore Taranaki Cheal oil field – that last year produced 31,000 barrels of oil, providing $NZ1.8 million of revenue - were well advanced and work would start as soon as the approval of that joint venture participants had been secured.

Cheal should be onstream in the fourth quarter of 2006, given an immediate start to development activities.

Webber also said he was optimistic about the nearby deep-gas Cardiff field. The arrival of additional test equipment from the US earlier this week would allow Austral to complete final prduction testing at Cardiff.

“I believe there is a significant prize to be won at Cardiff and getting a definitive test result and a declaration of commerciality over the discovery are key steps along the way,” he said.

“From a strategic point of view, Cheal and Cardiff are fundamental to our goal of establishing and building a sustainable production profile.”

Stockholders equity at December was $NZ24.7 million – an increase from 2004 of $NZ8.7 million. The increase was primarily because of the successful $NZ10 million private placement of shares last October.