The Sydney-headquartered company told the ASX and NZX yesterday that its A$3,995,000 loss included a full year of revenues and costs from its former interest in the Tubridgi gas field as proceeds from that sale were not received until after the end of the financial year (July 4).

Exploration write-offs during the period were A$2,798,000, mainly related to drilling the unsuccessful Kiwi exploration well in offshore Taranaki licence PEP 38460 and accumulated costs of drilling and evaluating the offshore Western Australian Taunton prospect.

Following the drilling of Blackthorne-1, the TL2 joint venture concluded a Taunton development would be a commercially marginal project, though future development might still be possible if further nearby discoveries were made.

Pan Pacific, which holds a 10% stake in the Tui Area (Tui-Amokura-Pateke) oil discoveries elsewhere in PEP 38460, said a final investment decision on development of these was scheduled for late October.

FID by that date would lead to first oil production in early 2007, with initial flows expected to exceed 30,000 barrels of oil per day (bopd). Rapid payback of the investment in the Tui development was supported by an oil price of only US$35 per barrel (currently US$65).

In addition to the Tui development wells, two exploration wells were proposed for adjacent prospects, which if successful could be tied into the initial development.

Candidates included Tieke, Oi, Matuku, Taranui, and Kahu - with Tieke (updip from Tui and having unrisked potential for 25 million barrels at the Eocene-aged Kapuni F sands) and Taranui (40 million barrels at the F sands) the most likely.

Also interpretation of 2D seismic data acquired over the Hector prospects in nearby PEP38483 (Pan Pacific Petroleum 14.9% interest) was expected to lead to a drilling decision on that acreage before the end of 2005. The Hector area was considered highly prospective, due to favourable reservoir development in the Kapuni F sands and proximity to the hydrocarbon "kitchen" sourcing those reservoir sands.

In the Carnarvon basin several exploration prospects, including Bricklanding in TP7 (PPP 4.16%), were being reviewed as possible drilling candidates.

Several prospects wree being evaluated from recent seismic reprocessing in WA254P (PPP 2.99%). Of these, the Duomonte prospect was a candidate for drilling in late 2005.