"There is a common perception that our market cap is only about $200 million, but of our 352 million shares on issue 180 million [held by parent company Anzon Energy] are held in escrow," Koroknay said.

"Based on our current share price, Anzon Australia is in fact a half-billion dollar company."

Anzon managed to become a profitable midcap company in its first year of being listed by undertaking an innovative offshore production production program, he said.

The company bought the Basker-Manta-Gummy oil and gas play in Bass Strait from Woodside Petroleum in early 2004, leading to a December listing in the same year.

As operator, Anzon recently completed the third delivery of oil from the Anzon-Beach joint venture project (50% each), with the more than 164,000 barrels of crude oil in the delivery earning the JV around $16 million.

When combined with the previous two sales, that equates to production of 868,000 bbl for a gross revenue of more than $78 million, of which more than $41 million has gone to Anzon.

Anzon is using a floating production storage off-take vessel (FPSO), the Crystal Ocean, with production being conveyed by an export line to the shuttle tanker Basker Spirit. The Basker Spirit delivers the crude to a local refinery or to another tanker for export.

While using the FPSO and shuttle tanker incurs high ongoing operational costs, it has meant the upfront costs were minimal, allowing Anzon to achieve cashflows quickly.

The FPSO is currently in Singapore being fitted for purpose for Anzon's full field development program, which will see the begining of gas production.

Next year Anzon expects to more than $300 million in revenue in 2007 based on a conservative oil price of $55 per barrel.

Executive chairman Steve Koroknay said 2006 so far had been “extremely successful".

The FPSO had worked very well with less than 2% downtime, he said.

Basker Manta Gummy 2P oil reserves had been upgraded from 23 million barrels to more than 30 million and contingent gas reserves had also been upgraded. In addition, the company had also confirmed the connectivity of gas sands, which would make gas production much easier.

A new reserves estimate from Gaffney Cline was expected next week and a further upgrade was likely, Koroknay said.

“All the drilling has been completed and there are now five production wells available – one in Manta and four in Basker,” he said.

“Because of the good results from drilling, we expect that there will be an increase in reserves that means the plateau production will be extended.”

Production was previously expected to drop off around August next year, but new estimates have pegged consistent peak output into 2008. Production levels cannot increase because the operation is already forecast to be at system capacity.

“That gives us excellent cash flow for an extended period so we can look at exploration opportunities,” Koroknay said.

The company was currently paying petroleum resources rent tax of about $50 million a year and was eager to offset exploration expenses against the PRRT.

Anzon had taken 10% stakes into leases adjacent to the BMG fields and was assessing other exploration opportunities, Koroknay said.