The joint venture, formed in July last year, has announced a discovery in its first well, drilled about 2km from the Varanus and Cooba fields.

Varanus South-1 in PEL 513 uncovered an aggregate best estimate of 18m of net gas pay in the Patchawarra formation and an additional 9m of net hydrocarbon pay in the Tirrawarra formation.

The 3154m-deep well has been cased and suspended as a future wet gas producer, with further interpretation of the data to come.

The JV will now move their attention the Yarowinnie South-1 well.

Yarowinnie is located 7km southwest of Varanus South-1 and 5.4km south of the Andree-Leleptian field, which is run by Santos, Origin Energy and Beach Energy under the South Australian Cooper Basin Joint Venture banner.

Santos is operator of the JV with Drillsearch, owning 60%. Drillsearch holds the remaining 40%.

"This discovery represents an excellent start to our drilling campaign with Santos and highlights once again the prospectivity of this area for wet gas," Drillsearch managing director Brad Lingo said.

"We have an active program underway to commercialise the various wet gas discoveries in our portfolio and we look forward to working with Santos to bring Varanus South-1 into production."

Drillsearch was up 0.46% to $1.10 per share this morning, while Santos was down 0.92% to $11.97 per share.