The 2003 revenue surge was achieved on net production to Petsec of 4.5 billion cubic feet of gas equivalent, compared with none in the previous year when the company's revenue was only $0.9 million.

Six hydrocarbon bearing sands were discovered in the Vermilion 258 No 1 well with an estimated 27 metres of net gas pay and the No 2 well found three hydrocarbon bearing sands having an estimated 13 metres of net gas pay. Both wells have been suspended for future completion and production.

Executive chairman, Terry Fern stated that "Petsec has commenced construction of a $US7.8 million production platform, facilities and pipeline with production capacity of 45 million cubic feet of gas per day."

"Production from both wells is expected to commence in mid-year," he said. "Following production start-up, further drilling is expected in the 2004 third quarter."

Petsec's Vermilion 246, 257 and 258 leases are located approximately 105km south of Vermilion Parish, offshore Louisiana, USA in the Gulf of Mexico.

During the latest quarter, Petsec also successfully brought into production its West Cameron 352 No A14ST and West Cameron 343 No A19 wells.

Petsec also has a 25% working interest in a drilling program of two to five wells expected to commence soon in the Beibu Gulf, China, where another Australian company, Roc Oil Limited, is the operator.