The U.S. Department of Interior, Minerals Management Service (MMS) awarded Petsec the Vermilion 244 and 259 leases, adjacent to and west of the Vermilion 258 lease, containing the above wells.

The Vermilion 258 #1 well intersected six hydrocarbon bearing sands for a total of 27 metres (85 feet) of net gas pay. The Vermilion 258 #2 well intersected three hydrocarbon bearing sands having an estimated 13 metres (47 feet) of net gas pay.

Petsec said construction of the platform and production facilities for the project is on schedule. The platform is expected to be installed this week and pipeline construction will commence shortly after. Production from both wells is expected to commence mid-2004.

Further drilling on the Vermilion leases is scheduled for the second half of 2004.