CISCO, Texas, Dec. 6, 2004 (PRIMEZONE) -- Australian-Canadian Oil Royalties Ltd. (OTCBB:AUCAF) is excited to announce that Apache Corp. has reported the results of the first Drill-stem test (DST) on the Longtom-2 well in the offshore Gippsland Basin of Victoria in the Bass Strait. The Longtom-2 well flowed at a stabilized rate of 18-19 MMCF/per day of gas through a 1" choke over an 11 hour period with well head pressure at the end of the test at approximately 965 psi. The Longtom-2 well was tested over the interval 2184.0-2192.5 meters and 2212.5-2243.5 meters. This interval will be isolated and the well prepared for DST No. 2. The well also flowed gas with a Condensate to Gas Ratio of approximately 3 barrels/MMCF. VIC/P54 covers 155,676 gross acres and ACOR has a .05% ORRI under all this acreage. We are pleased to report this new discovery.
This successful test is a major discovery in the Gippsland Basin. It represents the first significant gas flow from the Emperor Formation. The majority of the Gippsland Basin wells have been completed in the upper Latrobe Formation. In excess of 4 billion barrels of oil/condensate and 12 TCF gas reserves have been discovered in the Basin since exploration drilling began in 1964, with remaining reserves estimated at 600 million barrels of oil and 5 trillion cubic feet of gas.
Despite its long history of extensive exploration, many parts of the basin areas and depths, are still poorly understood. For such a prolific basin, the Gippsland Basin is relatively unexplored and ACOR's management believes there is still considerable potential for significant discoveries like the Longtom-2.
ACOR acquires a 25% Offshore Working Interest in the Gippsland Basin
ACOR has acquired a 25% working interest in the offshore Permit VIC/P60 covering 339,769 acres in the Bass Strait of Victoria Australia. ACOR has already begun the year one (1) seismic expenditures on the block. VIC/P60 has an anticline with 400 feet of seismic closure. The anticline is an undrilled upper Latrobe Prospect. The Halibut and Kingfish Oil Fields are completed in the upper Latrobe of Tertiary Age. ACOR's management has just ordered a new state of the art software program to interpret the existing 2-D seismic data on Permit 60.
More ACOR Offshore ORRI in the Gippsland Basin
Adjoining VIC/P60 is VIC/P45. The Kingfish Field begins 1-1/2 miles west of VIC/P45. The Kingfish Oil Field has produced in excess of 1.1 billion barrels of oil. Calculating at current crude oil prices of $US43.40 per barrel, this represents approximately $47.74 billion worth of production. ACOR owns an ORRI under VIC/P45 and it is reported that BHP-Billiton will start drilling before May 16, 2005, probably on the Anemone SE structure SE of the Archer well, which has 11 pays, 4 oil and 7 gas with 1200 feet of net pay section.
ACOR holds a .05% overriding royalty located Offshore Australia in the Bass Strait under VIC/P53. The ORRI under VIC/P53 is surrounded by GIANT Oil & Gas production. The Australian Government estimates that VIC/P53 could contain approximately 167,000,000 bbls of oil. ACOR's offshore ORRI's and working interests in the Gippsland Basin go North & South through the middle of some of the best production in the Bass Strait.
Onshore South Australia
Mosaic Oil N.L. to carry out cased hole testing on ACOR's Canberra-1A ORRI
Victoria Petroleum NL advises that the PEL 115 Joint venture has entered into a Farm-in Agreement with Mosaic Oil N.L. whereby Mosaic Oil N.L. will earn a 10% interest in the Canberra Prospect and 50% of any oil production from the Canberra-1A well bore by carrying out a cased hole-testing program of the Permian section of the Canberra-1A Well.
The Canberra Prospect covers an area of approximately 12 square kilometers and is interpreted to have the potential to contain up to 10 million barrels of oil in target Permian sands, if oil is present. Dr Howard Brady, Mosaic's CEO, says "there is a chance that the well missed some oil in the Patchawarra Formation and the possibilities are open for horizontal drilling. This test is high risk. It gives us a low cost entry into what we see as an exciting prospect with high upside potential. We will operate the test but then the Operatorship will stay with Victoria Petroleum," he said. The operator of PEL 115 advises that 7" production casing has been run and cemented at 2406 meters and the drilling rig released from the Canberra-1A drill site.
MIRAGE-1 commences drilling on ACOR's PEL 115 ORRI
The OD&E Rig 20 is now drilling Mirage-1, 8 kilometers to the southeast of Canberra-1A and 5 kilometers to the east of the Ventura-1 Well that recovered 44 barrels of clean oil from the McKinlay-Namur Sandstones with an indicated potential pump rate of 340 barrels of oil per day. The Mirage Prospect is a robust conventional anticline prospect, similar in style to the Ventura Structure, with the interpreted potential to contain within target Jurassic Sands, from a mean of 1.9 million up to 19 million (P10) recoverable barrels of oil, if oil is present. The Mirage-1 Well is expected to drill to a total depth of 1,871 meters.
About Australian-Canadian Oil Royalties Ltd.
ACOR's principal assets consist of 14,926,346 gross surface acres of overriding royalty interest and 8,900,776 gross acres of working interests, located Onshore Australia in the Cooper-Eromanga Basin and Offshore Australia in the Gippsland Basin in the Bass Strait. ACOR is a publicly traded oil company trading on the NASDAQ OTC Bulletin Board Exchange under the trading symbol "AUCAF". Visit our new website to see more information on all the properties just mentioned above at: www.aussieoil.com .
Disclaimer: Except for historical information contained herein, the statements released are forward-looking statements that are made pursuant to the provision of the Private Securities Litigation Reform Act of 1955. Forward-looking statements involve known and unknown risks and uncertainties that may cause the Company's actual results in future periods to differ materially from forecasted results. Such risks and uncertainties include, but are not limited to, market conditions, competitive factors, the ability to successfully complete additional financings and other risks.