Speaking at a function for the South Australian Chamber of Mines and Energy, Nelson said good returns were being made from the basin at relatively low levels of risk.

"Many equities dealers are obsessed with only the big offshore oil and gas plays or new exotic locations.

"Yet the sums add up far more favourably for companies driving progressive onshore exploration and production work - with the stand-out performer being the Cooper Basin and its string of new successes on its perimeter acreage.

"At a selling price of A$45-50 per barrel, such discoveries can deliver a net present value (NPV) of about $A15-20 per barrel," he said.

"That is multiples of the NPV per barrel for most offshore discoveries which have to contend with large development costs and lead times of often years between discovery, production and first cash flows.

"By comparison, it was only four months between Beach's discovery in July last year of the Sellicks-1 oil field in the Cooper Basin and a start to production."

Mr Nelson said that under the new exploration focus by independents in the Cooper Basin, the province was yielding, and, he believed, would continue to yield, incremental field discoveries of two million barrels or more.

"Solid, onshore and low risk these discoveries may be but they are being misinterpreted or shunned by equities markets at a time the share price and dividend performance of the more fancied Australian E&P companies continues to slip."

Nelson's comments pre-empt an eight well wildcat exploration program that Beach Petroleum is about to launch in the area.

The campaign follows a successful nine well program in 2002 in which oil was recovered from every exploration well drilled by the company, with four wells now in commercial production.