The drilling program will begin in the onshore Marlo Block in PEP 155. The first well, Patrobus, will be followed by Banjo. Lakes will hold a 41% interest in these wells and Lakes spinoff Gippsland Offshore Petroleum will pay the first $200,000 of expenditure.

The third well, Bellarine-1 is due to spud in mid July. Located in PEP 163 about 20km south of Geelong, it will be drilled up-dip of the 1969 well Hindhaugh Creek-1, which flowed gas to surface. Jupiter Energy will carry Lakes for the first $1.2m of well costs to earn a 505 interest in the permit.

The fourth well, Gilbert-1, is in Bass Strait. It is due to spud in three months, depending on the scheduling of the Ocean Patriot rig.

Interests in the Gilbert Block subsequent to the drilling of Gilbert will be: Gippsland Offshore Petroleum Ltd 51%, Lakes Oil N.L. 26%, Moby Oil and Gas Ltd 10%, Eagle Bay Resources NL 10% and Rilo Explorations Pty Ltd 3%. The operator will be Bass Strait Oil Company, which holds the surrounding permit, Vic/P47.

Meanwhile, arrival on site of Halliburton Australia hydraulic fracturing equipment earlier this week set in motion work at the Trifon and Wombat gas fields, east of Melbourne.

Chairman Robert Annells says the work was the company’s most important to date.

Lakes will test and fracture three zones at Wombat-3 - the oil zone discovered in the 2,106m sand, the gas zone occurring in the 1900m sand, and test and fracture the gas zone occurring in the 1400m sand.

In the Trifon Field, Lakes will test and fracture the gas zone in the 1825m sand in Trifon-2, and re-enter, perforate, and consider a possible fracture to the gas zone occurring in the 1127m sand in North Seaspray-3.

All the data from hydraulic fracturing will be sent to Landmark Consulting, USA to be part of the pre-production feasibility study.

In the Latrobe Valley, discussions about drilling a well below Hazelwood Power Station have led the company to plan drilling in August on the the Loy Yang dome below Loy Yang A and B power stations.