Located 6.5km east of the Hovea Production Facility and about 1.3km north of the Mondarra gas field the well is being drilled directionally to allow flexibility for additional well locations from the same pad.

“Centella-1 is the fourth of the gas exploration wells being drilled in our gas exploration program on our Perth Basin licences. It will test a prospect which is well defined by 3D seismic data as were the recent discoveries at Xyris, Apium and Tarantula,” said ARC managing director Eric Streitberg.

“The Centella closure also lies updip from the Mondarra-3 well which encountered good reservoir development in the Dongara Sandstone and had an oil recovery from this section.”

The target bottom hole location is 856m southeast of the surface location while the depth to the prognosed top of the primary objective Dongara Sandstone is approximately 2970m.

Participants in L1 and L2 (excluding the Dongara, Mondarra and Yardarino fields) and Centella-1 are ARC Energy 50% (Operator) and Origin Energy Developments 50%.

In corporate news ARC seems to have been given a tick of endorsement with US-based investment firm Goldman Sachs, through its Australian arm JB Were, popping up with 5% of ARC’s issued capital in an announcement posted yesterday afternoon.

It started buying small parcels at 84 cents in May, only splashing out its first serious money on the 5th August, taking 1.1 million shares at $1.03. The buying has continued with the bank now holding 9.3 million shares according to the statement yesterday.

Streitberg said Were's had always been a supporter of the stock and with the current oil prices and ARC's unhedged production, he expected more buying in the future.