The joint venture partners' share prices have stablised at levels significantly lower than they were before the the news of bad results from Cliff Head-5 in the offshore Perth Basin emerged. But further falls could come if Cliff Head-6 disappoints.

Cliff Head-6 spudded yesterday and is expected to reach total depth next week. Completion of this well will enable the calculation of a new reserves figure after which a final investment decision will be made, the partners said.

The Cliff Head-5 well was plugged and abandoned late last week after intersecting the top of the reservoir target 56 metres low to prognosis and coincident with the field’s oil-water contact.

This could lead to field reserves being downgraded significantly from the current 18 to 21 million barrels. Some analysts are predicting 14 million barrels as a likely figure.

The discrepancy between the prognosed and actual depth at top reservoir target level was probably caused by unexpected seismic velocity variations in the overlying sequence, according to Roc Oil CEO John Doran.

"Fifty-six metres is a big seismic bust,particularly at relatively shallow depth," Doran said.

"Seismic velocity variations of this magnitude can work against you - as they have plainly done at the CH-5 location - or, they can work for you, as could happen in other parts of the structure. However, whether or not that will happen elsewhere within the Cliff Head field is pure speculation at this stage.

"The fact that the target reservoir sands in CH-5 represent the best quality sands seen in the field area offers a degree of ironic comfort."

Participants in WA-286-P are: Roc Oil (WA) Pty Limited 37.5%, AWE Oil (Western Australia ) Pty Ltd 27.5%, Wandoo Petroleum Pty Ltd 24%, Voyager (PB) Limited 6% and Cieco Exploration and Production (Australia) Pty Ltd 5%.