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ACOR Gives an Offshore Australia-Gippsland Basin Update

^{Published on 2008-12-18 07:43:01 - Market Wire}
 

CISCO, Texas--([ BUSINESS WIRE ])--Please replace the release with the following corrected version due to multiple revisions to the section labeled "About VIC/P53."

The corrected release reads:

ACOR GIVES AN OFFSHORE AUSTRALIA-GIPPSLAND BASIN UPDATE

The Madfish-1 well is rigging up to run wireline logs with possible estimated mean reserves of approximately 33,000,000 barrels of oil

Australian-Canadian Oil Royalties Ltd. (herein called ACOR) (OTCBB:[ AUCAF ]) is pleased to announce that the Operator is rigging up to run wireline logs over the Madfish-1 Offshore Well. The wireline logs will determine if the hydrocarbon detected is capable of flowing in commercial quantities.

The Madfish-1 exploration well was spudded on November 27^th in the offshore Gippsland Basin, targeting possible mean reserves of approximately 33.6 - 41.7 million barrels of oil.

The Madfish-1 well on ACOR's ORRI under VIC/P59 is being drilled by the Ocean Patriot semi-submersible drilling rig.

The Madfish-1 well will be followed by the Elver-1 prospect that will target possible mean oil reserves of approximately 39.5-51.3MMbbl respectively.

The Madfish-1 well is located in about 1279 feet of water and has a planned total depth of approximately 9,284 feet while the Elver-1 prospect has a planned total depth of approximately 10,334 feet.

About VIC/P59

VIC/P59 consists of 301,468 gross acres and is located offshore in the Gippsland Basin. VIC/P59 is adjoined by the Blackback Oil Field with estimated reserves of 80,000,000 barrels of oil.

ACOR owns a 1/20^th of 1% ORRI under VIC/P59.

ACOR's other Offshore Gippsland Basin Assets

VIC/P45

VIC/P45 consists of 214,896 gross acres. VIC/P45 adjoins VIC/P59 to the west. VIC/P45 is located offshore in the most prolific oil-producing basin in Australia, approximately 1 1/2 miles east of the Kingfish Oil Field in the Southern Gippsland Basin in the Bass Strait.

The Kingfish Oil Field, the largest oil field in Australia, has produced 1,100,000,000 barrels of oil since its discovery. There are currently 23 producing wells in the field. The permeability in the pay section ranges between 5,000 and 40,000 millidarcies, which is extremely high.

On mapping there are 14 structures on VIC/P45, which includes one oil and gas field discovery with 16 pays and over 1,000 feet of pay section and a second with one gas pay section. This was a discovery well drilled off projected prospects.

ACOR owns a 3/20^ths of 1% ORRI under VIC/P59.

VIC/P54

Offshore Australia Longtom-4 Well Flows Approximately 58 Million Cubic Feet of Gas per Day on 35 hour Production Test on ACOR's ORRI on the Longtom Gas Field under VIC/P54.

The test of the primary production zone within the Admiral formation flowed at a rate of approximately 58 MMCF per day through a 64/64" choke on ACOR's ORRI.

The well flowed for 35 hours before being shut-in to monitor the pressure response from the reservoir. The forward plan is to suspend the well as a future producer with the rig expected to be released by the end of the week.

Longtom-4 is the second production well drilled, completed and tested in preparation for commercial production. Analysis of the production performance suggests that Longtom-4 alone would be capable of meeting the anticipated maximum contract requirements of the Longtom field.

In September 2006, the Longtom-3 well flowed at over 75 MMCF per day on test while bypassing the separator, confirming that it can also alone meet the contract requirements.

Nexus said, "the testing of Longtom-4 is another important milestone on the path to first production by mid 2009."

Longtom-4 has been drilled by the West Triton jack-up and is the second development well for the Longtom gas project. The Longtom-3 well, drilled during the third quarter of 2006, is ready for commercial production with no further rig intervention required. Timing of a planned third development well will depend on the field's production performance over time. The current plan assumes this well will be drilled two to three years after project start-up.

Gas produced from the Longtom wells will enter a new 12 inch pipeline and will be transported from the field to the end of Santos' existing Patricia-Baleen pipeline, 19 kilometers away. Nexus will construct this pipeline and the associated control lines and equipment with the pipelay barge contracted for installation in the December quarter.

The raw gas will then continue along the Patricia-Baleen pipeline to shore where it will be processed at Santos' existing onshore gas plant. Santos will install new equipment at the plant capable of processing the Longtom gas. This will primarily involve facilities for the stripping of condensate from the gas and the subsequent stabilization, storage and export of the condensate.

VIC/P54 (including VIC/L29) consists of 155,676 gross acres (243 square mile) and is located north of VIC/P59.

ACOR owns a 1/20^th of 1% ORRI under VIC/P54 (VIC/L29).

About VIC/P53

VIC/P53 consists of approximately 182,858 gross acres and is located north of VIC/P59. VIC/P53 is also called the "Hole of the Doughnut" as it is surrounded by 9 giant producing oil & gas fields, leaving VIC/P53 in the middle.

The nine giant oil & gas fields that surround ACOR's ORRI under VIC/P53 have some very impressive production figures, see below.

It is important to note that the fields listed below are still producing.

1. Kingfish Field was discovered in 1967 and has produced 1,100,000,000 barrels of oil or $41,800,000,000 at current market prices of $38.00 per barrel from 41 wells.
2. Bream Field started drilling in 1988 and has produced 88,000,000 barrels of oil or $3,344,000,000 at current market prices of $38.00 per barrel from 20 wells.
3. Barracouta Field started drilling in 1968 and has produced 1.1 TCF of gas or $2,750,000,000 at $2.50 per mcf gas prices from 10 wells.
4. Snapper Field started drilling in 1968 and has produced 630 BCF of gas or $1,575,000,000 at $2.50 per mcf gas prices from 23 wells. The nearest well in the Snapper Field is approx. 1 mile from ACOR's VIC/P53 lease line. ACOR's Seismic work shows a seismic high coming from the Snapper Field possibly extending over into Permit 53. The Snapper Field has produced an avg. of approximately 105 BCF of gas per well.
5. Marlin Field started drilling in 1968 and has produced 2.4 TCF of gas or $6,000,000,000 at $2.50 per mcf gas prices from 19 wells.
6. Fortesque Field started drilling in 1982 and has produced 260,000,000 barrels of oil or $9,880,000,000 at current market prices of $38.00 per barrel from 28 wells.
7. Halibut Field started drilling in 1969 and has produced 820,000,000 barrels of oil or $31,160,000,000 at current market prices of $38.00 per barrel from 14 wells.
8. Cobia Field started drilling in 1983 and has produced 135,000,000 barrels of oil or $5,130,000,000 at current market prices of $38.00 per barrel from 20 wells.
9. Mackerel Field started drilling in 1977 and has produced 450,000,000 barrels of oil or $17,100,000,000 at current market prices of $38.00 per barrel from 22 wells.

VIC/P53 is considered prospective for oil and gas at the top Latrobe and also at deeper intra Latrobe levels.

ACOR owns 3/20ths of 1% ORRI under VIC/P53.

VIC/P60

VIC/P60 adjoins VIC/P59 to the south and covers approximately 339,769 acres. ACOR management has identified six leads from the existing seismic data. The A-1 lead is approximately 4.97 miles long and 1.24 miles wide with a seismic bright spot anomalie rated good to excellent.

The seismic bright spot is 108' thick and 820' horizontal by 20,500' perpendicular wide behind a fault on the flank of the anticline. ACOR has traced the beds to the nearest oil and gas fields after processing 5,000 +/- seismic lines.

The A-1 Lead, if productive has the possible potential to contain approximately 70,000,000 barrels of oil.

ACOR owns an 50% of 1% ORRI under VIC/P60.

About The Gippsland Basin:

In excess of 4 billion barrels of oil/condensate and 12 TCF gas reserves have been discovered in the Basin since exploration drilling began in 1964, with remaining reserves estimated at 600 million barrels of oil and 5 trillion cubic feet of gas. Current production of the Basin is around 140,000 barrels per day of crude and 570 million cubic feet per day of gas. At peak rates, the Gippsland Basin can deliver more than 1,000 million cubic feet a day.

Some of the very best oil production in the world is found in the Gippsland Basin.

Click on link below to see a map of ACOR's Gippsland Basin Assets.

[ http://www.aussieoil.com/site/acor-map.htm ]

About Australian-Canadian Oil Royalties Ltd.:

ACOR management draws no cash salary. ACOR's principal assets consist of overriding royalty interest under 15,440,116 gross surface acres and working interests under approximately 8,561,007 gross acres, located Onshore Australia in the Cooper-Eromanga Basin and Offshore Australia in the Gippsland Basin in the Bass Strait and Offshore in the Carnarvon Basin in Western Australia.

ACOR management traveled to Australia this year to attend the APPEA meeting in Perth. ACOR has identified a giant oil & gas trend in the Carnarvorn Basin and is making best efforts in trying to acquire some additional working interest in this prolific Basin.

The Carnarvon Basin is Australia's largest petroleum providence. The Carnarvon basin in the Northwest Shelf contains a number of giant gas and gas-condensate fields. The Greater Gorgon area, which includes other nearby gas fields, is 130 km off the northwest coast of Western Australia in the Carnarvon basin. The fields in that area contain in excess of 40 Trillion Cubic Feet of gas.

In 2007, Western Australia produced 126 million barrels of crude oil/condensate, and 30 billion cubic meters of gas. 65% of the gas was transformed into 12 million tonnes of LNG (all of which was exported), with the remainder of the gas being sold to users in Western Australia. Primary production by the industry was valued at $16.7 billion, accounting for 31% of all natural resources produced in the state.

ACOR has just purchased several thousand dollars worth of new Kingdom 2D/3D seismic software to work on areas of interest to ACOR in the Carnarvon Basin in Western Australia.

ACOR is a publicly traded oil company trading on the NASDAQ OTC Bulletin Board Exchange under the trading symbol "AUCAF."

Summary:

Australia is a "hot spot" for oil & gas exploration and ACOR is positioned for possible "Company-Maker" discoveries. ACOR's working interests and overriding royalty interests are located offshore & onshore in the best producing basins.

Visit our website at [ www.aussieoil.com ].

Disclaimer:

Except for historical information contained herein, the statements released are forward-looking statements that are made pursuant to the provision of the Private Securities Litigation Reform Act of 1955. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to differ materially from forecasted results. Such risks and uncertainties include, but are not limited to, market conditions, competitive factors, the ability to successfully complete additional financings and other risks.