Stuart has also recently been granted its fourth exploration license, PEL 113 in the Cooper/Eromanga basins. Exploration on the block will begin immediately with at least two wells, one gas and one oil, being drilled in the next year.

The block will be the focus of the company's gas strategy as the exploration targets identified are close to existing infrastructure; moderate to high rate producers of significant size; with around 10 BCF gas in place.

Stuart said it will also maintain its current exploration strategy of targeting a 65% to 75% working interest as operator in its properties, then seeking farmin partners for the block or part thereof.

In order to increase the Acrasia partners' ready cash flow, they have also increased production from the field from 800 bopd to 1200 bopd, following optimisation of the three producing wells. With the contracting of an additional crude oil road tanker in the next month this is expected to peak at 1600 bopd.

In order to maintain production at these levels as long as possible the production facilities at the field are being currently upgraded and include the installation of jet pumping facilities on all wells.

As a result of these activities Stuart's share of the forecast production for the 2003/04 budget year is expected to increase to between 250,000 and 300,000 barrels of oil, from an estimated 110,000 barrels this financial year.

Interests in Acrasia are Stuart Petroleum (75%) and Beach Petroleum (25%).