The well will now be plugged and abandoned, according to joint venture partner Sunshine Gas.

“Whilst disappointing, the Wellington result does not significantly affect the other identified prospectivity in the licence area,” said Sunshine chief executive Tony Gilby.

“Once the results of Wellington have been fully analysed, the focus of work will be geared toward monetising the Strathmore oil discovery located within the permit.”

Strathmore was deemed non-commercial when found by Amerada Hess. While it contains up to 200 million barrels (MMbbl) of oil, only 36MMbbl were deemed to be recoverable.

But the oil price has risen enormously since that time and Sunshine believes it can improve on the original geological interpretation.

The 50:50 joint venture comprises Sunshine Oil, a wholly owned subsidiary of Sunshine Gas, and operator Hurricane Exploration.

The Wellington-1 well meets the JV’s well commitment to the UK Department of Trade and Industry on the PL 1368 lease.

It is anticipated that the Bredford Dolphin drilling rig will move off location by September 2.

Gilby said Sunshine was pleased with the drilling operation and current indications were that the well would be on or under budget.

“The company remains well funded and has an active drilling program scheduled for the remainder of 2006 in Queensland,” he said.

“This activity will commence with the drilling of the Champagne Creek-2 Deep well in September as part of the Beach Petroleum farm-in.”