WestSide Corporation Limited (ASX:WCL) Operational Report
WestSide Corporation Limited (ASX:WCL) Operational Report

Brisbane, May 12, 2010 AEST (ABN Newswire) - WestSide Corporation Limited (googlechartASX:WCL) is preparing to make a rapid transition from explorer to CSG producer following the imminent completion of the Company transforming Dawson Seamgas acquisition.

Consequently, WestSide is commissioning a team to take control of the producing Dawson CSG fields in the Bowen Basin in June and plans to drill a series of lateral production wells to boost production soon after gaining operatorship. A seismic acquisition program is also planned for this period.

Meanwhile, in April WestSide was able to resume an aggressive 2010 drilling program in the Company's Bowen Basin tenements after seasonal wet weather disrupted field activity for several weeks during the quarter. Acquisition of seismic data in ATP 688P will take place in early May.

WestSide has procured the services of a second drilling rig to accelerate the 11-well program. The program aims to build on WestSide's initial gas reserves, with the current phase targeting accelerated appraisal of the Mount Saint Martin area.

Five exploratory wells are planned in the current program following promising gas content data from the MSM #1 core well and the identification of additional prospective coal seams in January. Two new wells are planned for areas of ATP 688P which have not previously been explored and up to five new wells are planned for the Paranui pilot in ATP 769P.

WestSide expects to complete the purchase of two new Galilee Basin exploration tenements, ATP 974P and ATP 978P, in coming months. Drilling is expected to commence in the new tenements late in 2010 or early 2011 if the issue of permits is further delayed.

PROJECTS

Bowen Basin

Tilbrook, Mount Saint Martin and Bald Hill (ATP 688P)

(WestSide interest 50%) Reserves: 76 PJ (3P) net to WestSide

Tilbrook

The Tilbrook pilot is designed to appraise the Moranbah Coal Measures and is comprised of one dual-lateral horizontal appraisal well (Tilbrook #8), one vertical appraisal well (Tilbrook #7) and two observation wells (Tilbrook #4 and #6).

Production testing of the Tilbrook #8 dual-lateral well continued during the quarter. Reservoir modelling is continuing using data accumulated during production testing.

An extended production test of the current appraisal wells, Tilbrook #8 and Tilbrook #7, is planned to continue for several months.

New ATP 688P exploration

Core wells Mount Leslie #8 and Exmoor #9 will target the gas potential of new precincts in ATP 688P located to the south and south east of the Mount Saint Martin area.

Mount Saint Martin

In response to promising gas content and saturation data from the MSM #1 well, WestSide plans to drill several new wells in the region to further define the gas resource.

The first of the new wells (MSM #3) was drilled in January 2010 and encountered 26 metres of coal in the Moranbah Coal Measures - significantly more than the 10 metres intersected by the MSM #1 core well. The well identified additional, deeper coal seams that could significantly increase the Company's CSG resource in the area.

The MSM #2 appraisal well was drilled in April 2010 and intersected 26 metres of net coal, confirming the extension of the deeper coal seams. The MSM #5 core well, located at the northern extremity of the Mount Saint Martin area, encountered intrusions which resulted in net coal of 12 metres.

The MSM #7 exploration hole on the eastern flank of the Mount Saint Martin area intersected 10 metres of net coal after allowing for intrusions. A further two wells will be drilled to confirm the lateral extension of the target coal seams and appraise the gas contents over the wider area to extend the 3P reserves position.
---------------------------------------------------------Well    Well Type    Spud Date   Finish Date   Results---------------------------------------------------------MSM #1  Exploration  03/05/2009  20/05/2009    10m of        Core Hole                              net coal**---------------------------------------------------------MSM #3  Appraisal    14/01/2010  24/01/2010    26m of                                                net coal**---------------------------------------------------------MSM #2  Appraisal    10/04/2010  20/04/2010    26m of                                                net coal**---------------------------------------------------------MSM #5  Exploration  12/04/2010  22/04/2010    12m of         Core Hole                              net coal**---------------------------------------------------------MSM #7  Exploration  23/04/2010  30/04/2010*   10m of                                                net coal**---------------------------------------------------------MSM #4  Appraisal    01/05/2010* 08/05/2010*---------------------------------------------------------MSM #6  Exploration  10/05/2010* 15/05/2010*---------------------------------------------------------Mount   Exploration  17/05/2010* 24/05/2010*Leslie  Core Hole#8---------------------------------------------------------Exmoor  Exploration  26/05/2010* 03/06/2010*#9      Core Hole---------------------------------------------------------
* Proposed dates
** Net coal is in Moranbah Coal Measures only

Paranui (ATP 769P)

(WestSide interest 50%)

Reserves: 135 PJ (3P) net to WestSide

The Paranui pilot comprises three appraisal wells (Paranui #5R, #6R and #8), two observer wells (Paranui #4 and #7) and one core well (Paranui #10). Production testing of the Paranui #5R and #8 wells continued during the quarter.

Two new wells are planned to the west of the Paranui pilot to assess the gas resource at depths greater than the 1,000 metre depth currently addressed by the pilot. The ability to access gas from coals deeper than 1,000 metres could add significantly to WestSide's current 3P (Proved, Probable and Possible) gas reserves.

Up to three new wells are proposed to expand the existing pilot to test production rates.

The new wells will aim to confirm the geological structure and to convert some of the existing 3P gas reserves into 2P (Proved and Probable) reserves to support an application for a Petroleum Lease in 2010.

Galilee Basin

(ATP 974P and ATP 978P - pending)

Galilee Basin tenements (pending)

(WestSide interest 100% - pending)

WestSide has secured a significant foothold in Queensland's coal-rich Galilee Basin under an agreement to acquire two petroleum exploration tenements.

The Company will target CSG within the two pending exploration tenements, ATP 974P and ATP 978P, which cover a combined area of 14,480 km2 in the north-western part of the Galilee Basin.

WestSide believes the area could contain up to 21 trillion cubic feet of gas in place.

Following the issue of the permits and completion of the acquisition, WestSide will conduct geological, geophysical and other engineering studies within the two tenements as a precursor to exploratory drilling in late 2010 or early 2011 if the issue of permits is further delayed.

An environmental authority was awarded for the tenements in January 2010.

Capital raising

In April, WestSide announced a fully-underwritten capital raising of A$64.4 million backed by New Hope Corporation Ltd (googlechartASX:NHC) and the Infrastructure Capital Group (ICG)- managed Energy Infrastructure Trust (EIT). Both NHC and EIT were issued with shares, raising A$8.1 million at A$0.55 per share in April, and they are together underwriting a A$56.3 million 1-for-1 Entitlement Offer of new ordinary shares to existing shareholders at A$0.45 per share.

The offer closed on 10 May 2010. Shareholder enquiries should be made to WestSide's share registry on 1300 737 760.

International

WestSide has agreements with Indonesia's leading thermal coal producer, PT Bumi Resources (googlechartJAK:BUMI) (googlechartPINK:PBMRF), to jointly explore for CSG in Indonesia. Bumi subsidiaries PT Kaltim Prima Coal (KPC) and PT Arutmin Indonesia are together the largest thermal coal producers in Indonesia.

WestSide is awaiting confirmation of its interests in recently-awarded CSG permits in Indonesia from Bumi Resources.

Acquisition of Dawson CSG fields

WestSide confirmed the Company would make the transition from explorer to producer when it announced plans in March to join with Mitsui E&P Australia Pty Ltd ("MEPAU") to acquire the Dawson CSG fields in Queensland's Bowen Basin from existing owners Anglo American ("Anglo") (googlechartLON:AAL) and Mitsui Moura Investment Pty Ltd ("MMI").

Under the new joint venture arrangement, WestSide will be the operator and will pay A$26.8 million for a 51 per cent interest in the Dawson CSG fields (Petroleum Lease 94 and Mining Lease gas rights).

The Dawson Seamgas fields have certified Proved (1P) gas reserves of 60 petajoules (PJ), 186 PJ of Proved and Probable (2P) reserves and 334 PJ of Proved, Probable and Possible (3P) reserves.

The Dawson Seamgas fields near Moura are currently producing approximately 11 Terajoules of gas per day (TJ/day) and comprise a range of CSG assets including a petroleum lease, gas rights in mining leases and gas compression and pipeline infrastructure connected to Queensland's commercial gas network. A remedial well work over program has already commenced.

WestSide and MEPAU will be targeting work programs to increase the field production to 25 TJ/day and further expansion thereafter, with an ultimate goal of exporting LNG and supplying new domestic contracts from 2015/2016 when the current supply contracts in place expire.

The joint venture agreement will:

- Transform WestSide from an explorer into a producer;

- Deliver a strategic partnership with Mitsui (googlechartTYO:8031) and potential access to LNG markets through export opportunities;

- Provide an attractively priced entry to a producing gas asset with significant infrastructure in place;

- Give WestSide a stake in a well-located gas field, adjacent to the proposed Surat-to-Gladstone gas pipelines to supply feedstock to Queensland's burgeoning LNG industry and domestic market;

- Deliver early production revenues;

- Provide WestSide with domestic marketing rights for gas, aligned with Mitsui's global marketing rights for potential future LNG; and

- Deliver a compelling means of adding value to WestSide's adjacent Paranui CSG project (ATP 769P) which is jointly held with LNG proponent, QGC (a BG group company).

Potential for expanded alliance with MEPAU

MEPAU will have six months from completion to consider acquiring 49% of WestSide's existing interests in the neighbouring Paranui prospect (ATP 769P) and its new Galilee Basin tenements (ATP 974P and ATP 978P).

The acquisition price would be a proportionate reimbursement of acquisition, administration and exploration costs incurred to date by WestSide, subject where relevant, to the waiver of pre-emptive rights held by WestSide's existing joint venturers.

This is in line with WestSide's strategy of attracting a suitable joint venture partner for its new permits in the Galilee Basin.

Conditionality

Material conditions precedent outstanding at the date of this report:

- Indicative approval under relevant legislation and regulations of the transfer of the interests in the leases, tenements and pipeline licences to the new owners;

- Assignment of gas sales agreements to WestSide; and

- Finance being obtained to the satisfaction of the WestSide Board.

For the complete WestSide Corporation Operational Report including figures and pictures, please refer to the following link:

http://www.abnnewswire.net/media/en/docs/62841-ASX-WCL-220599.pdf

Contact

Angus Karoll
Chairman and CEO
WestSide Corporation Ltd
Ph: +61-7-3020-0900
www.westsidecorporation.com



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