Phase three, which will commence on 1 October 2004, is a one year exploration period exercisable at the option of the partners and carries a one well obligation.

During this third phase, the joint venture will concentrate on the commercialisation of the Wei 12-8 field as well as ongoing exploration evaluation.

The initial optimistic hopes of the partners were downgraded by a lack of success in the appraisal program, with two dry holes and confirmation of the viscous properties of the 12-8 field oil, which poses production problems.

However, the partners said analysis of data gathered during second quarter drilling of three wells in Block 22/12 indicated a cluster of exploration targets near the 6-12-1 (Wei) oil discovery well in the northern part of the block. The collective, unrisked, potential for these prospects is estimated by operator ROC Oil to be 40 to 50 mmbo recoverable.

The Block 22/12 joint venture consists of Roc Oil 40%, Horizon Oil 30%, Petsec Energy 25% and Oil Australia 5%.