Rigging up should take place over the coming weekend, with the well to be spudded late next week. Anticipated total depth is 1500m.

The current PEP 166 drilling program is targeting tight gas in the Strzelecki Group and possible oil at the base of the section in the Rintouls Creek Sandstone. It is intended to test the possibility that oil may be present towards basement edge.

“The discovery of shale capable of producing oil at Hazelwood-1 has encouraged Lakes Oil to drill this well, which will target the Lower Strzelecki and Rintouls Creek formations,” Lakes said.

“Lakes Oil is particularly anxious to look at the basement rocks in this area, as it will add significantly to our study of the entire onshore basin.”

Lakes Oil currently holds a 50% interest in the permit but is earning an additional 25% interest from PetroHunter by funding 100% of the drilling costs of this well.

AusAm Resources will then hold a 25% interest in the lease.