"We intend to write additional contracts with the goal of exceeding these projected figures," he said.

However Stammer did warn that there would be some failures along the way as several of Mosaic discoveries were in areas of poor seismic and drilling coverage and needed significant investment dollars and time in order to establish bankable gas reserves.

Mosaic recently completed a $14 million capital raising and is currently constructing a 25km gas pipeline from its Waggamba gas discovery in Queensland.

The field is scheduled to deliver gas from April 1, 2005, as part of a five year contract to supply 15 petajoules of gas to Queensland government utility, CS Energy.

During the week the company also spudded the Rockhampton High-1 well about five kilometres east of Mosaic’s Tinker oil and gas fields and 20km to the north west of the Waggamba gas field.

“We are not drilling a structural target and any discovery is a pure bonus. This well is being drilled quickly with mud to help us define the geology of a four hundred sq.km area we think has potential to hold Permian oil and gas, but there has been no drilling and little seismic,” said Mosaic CEO Dr Howard Brady.