“It is planned to continue production at approximately 450 barrels of oil per day,” Magellan said.

“The extended production test follows a successful 10-day well test conducted in November which confirmed the oil producing Patchawarra sandstone over the interval 1941-1946 metres is of good reservoir quality and laterally continuous.”

In late January-early February the Kiana partners plan to perforate a lower sand in the Patchawarra over the interval 1964.5-1967.5 metres. They expect this will initially add a further 200-400 barrels of oil per day to the production rate, according to Magellan.

The Kiana-1 participants have applied for a Petroleum Production Licence over the Kiana oil discovery, which is expected to be granted in the first quarter of 2006.

Kiana-1 is in PEL 107, about two kilometres to the southwest of the Muteroo oil field, two kilometres northeast of the Spencer oil field and 35 kilometres west of Moomba.

Participants in Kiana-1 are: Beach Petroleum Ltd (Operator) 40%, Great Artesian Oil and Gas Limited 30% and Magellan Petroleum (Southern) Pty Ltd 30%.