In December the company will two wells on the Vermilion 258 lease in the Gulf of Mexico.

The wells will be drilled to test 36 billion cubic feet (bcf) of unrisked mapped potential gas, including an estimated 8bcf of gas discovered, but not developed, in 1988.

If successful, field development would begin early in 2004, with production expected by mid 2004.

Petsec acquired the Vermilion 258 lease in 2000 for US$2.7 million. It then acquired the adjacent Vermilion 246 and 257 leases in March this year.

December will also see the start of up to 5 wells in China to test more than 40 million barrels of unrisked mapped potential of recoverable oil (Petsec share 10 mbbls) on Block 22/12 in the Beibu Gulf.

The joint venture (Roc Oil operator and Petsec (25% working interest) has approved two wells and three further wells contingent on the outcome of the first two wells.

Petsec's re-emergence as a Gulf of Mexico gas producer was also reflected in the quarterly report with revenue of $30.3 million for the nine months ended 30 September 2003, after payment of royalties, while net production to Petsec in the latest nine months was 3.22 bcf of gas.

The company's total revenue was only $0.9 million in the previous full calendar year.