The Adelaide-based junior said the wells - Aus-Tex PC9 and PC10 - were drilled to target depth and are part of the planned three wells scheduled for drilling on the Spillman Farm mineral lease.

As with previous wells of this type, gas came from Fort Payne and New Albany Shale formations and oil from the Corniferous formation, managing director David Schuette said.

"This discovery brings the total number of wells completed to nine with five of these being completed since March. All of these wells have had good shows of natural gas and four of the nine total wells also had good shows of crude oil," he said.

Acid stimulating of completed wells would begin next week and operator Resource Energy Technologies LLC plans to drill and complete the third well soon, the company said.

"This will give us our first opportunity to deliver natural gas to the processing plant and will also demonstrate our first absolute open flow rates after an acid stimulation," Schuette said.

"With the plant now coming online, we can also finally begin constructing the site pads for the four wells that had oil flows.

"The pump jacks, oil storage tanks and the equipment to separate the oil from the natural gas will then be installed. The oil will go to the storage tanks and natural gas to the pipeline."

Austin has permission to drill further wells at the project, and expects that up to 44 producing wells will be completed by the end of calendar 2008.

By the end of 2011, it predicts a further 200 wells would have been drilled.

Park City is one of Kentucky's newest commercial gas fields and the processing and gas distribution opportunities have attracted some major United States energy corporations.

Austin has other projects in the US, as well as gas and oil exploration projects in South Australia's Cooper Basin.