New Waitsia field potentially the largest conventional onshore gas discovery in WA since the 1960s.

- The Senecio-3 well has increased the development potential of the Senecio gas field and discovered the new "Waitsia" gas field in the underlying section.

- Waitsia represents an exciting new play for the north Perth Basin with large upside potential.

-The Senecio and Waitsia fields provide an early conventional production opportunity with combined gross 2C (P50) Contingent Resources of 360 Bcf.

Following on from the recently announced upgrade of 2C Contingent Resources in the Senecio Field, AWE Limited (ASX: AWE), as Operator of the L1/L2 Joint Venture, today announced initial Contingent Resource estimates for the "Waitsia" discovery (formerly Senecio Deep) located in the north Perth Basin.

After initial analysis of data from the Senecio-3 well, and the existing 3D seismic, AWE estimates that the Kingia/High Cliff Sandstone intervals in the Waitsia Field have gross Contingent Resources in the range from 65 billion cubic feet (Bcf) to 1170 Bcf, with a best estimate (2C) of 290 Bcf (Table 1). The presence of a significant quantity of potentially moveable hydrocarbons is indicated by strong gas shows, petrophysical analysis and pressure data. Net to AWE, the combined Senecio and Waitsia fields represent a best estimate (2C) of 180 Bcf of gas (Table 2).

Further evaluation and appraisal will be required to more accurately define the size of the accumulation and the lateral extent of the conventional and tight gas bearing sands. It should be noted that the Kingia/High Cliff Sandstone interval has not been previously penetrated in this part of the basin and represents an exciting new play with significant upside and follow-up potential.

AWE is also evaluating the gas bearing intervals in the Irwin River Coal Measures and Caryniginia Shale which could provide substantial additional unconventional resource potential. AWE estimates that the Irwin River Coal Measures has gross Prospective Resources in the range from 114 Bcf to 1497 Bcf, with a best estimate (P50) of 420 Bcf (Table 3). The presence of a significant quantity of hydrocarbons is indicated by strong gas shows and petrophysical analysis but further evaluation and appraisal would be required to establish whether reservoir productivity will be sufficient for commercial development. At this stage, AWE currently estimates the chance of development at 20%. This risking will change with further appraisal activities. Prospective Resources for the Carynginia Shale have not yet been estimated for this location, but could be substantial.

AWE has cased and suspended the Senecio-3 well in preparation for conventional flow testing of multiple reservoir intervals in the Senecio and Waitsia fields later in 2014. A Waitsia appraisal well is also under consideration for drilling in early 2015 immediately following the drilling of the Irwin-1 exploration well in EP320 (8km east of Senecio). The primary target for the Irwin prospect is the Dongara/Wagina sandstone but the well will also evaluate the deeper prospective horizons that have been high-graded by the Senecio-3 result.

The conversion of Contingent Resources to Reserves is subject to successful flow testing and a final investment decision for field development. If developed, Senecio/Waitsia will add approximately 30 million BOE, or 33%, to AWE’s 2P Reserves of 91 million BOE as at 30 June 2014.

Mr Bruce Clement, AWE’s Managing Director, said: "This is a fantastic result for AWE, the local Mid West community and for the people of Western Australia. The discovery in the deeper Kingia and High Cliff Sandstones has opened up an exciting new and substantial gas play in the north Perth Basin."AWE believes the Senecio/Waitsia discovery could represent the largest onshore conventional gas discovery in Western Australia since the Dongara gas field was discovered in the 1960s.

"Initial evaluation of the Senecio and Waitsia fields has identified 360 Bcf of gross Contingent Resources, which could be brought onto early production, utilising existing gas plant and pipeline infrastructure just 7km from the Senecio-3 location.

"There is also substantial upside to this initial estimated gas volume that could be realised by successful appraisal of the Waitsia discovery and exploitation of the unconventional gas potential identified in the Carynginia Shale and the Irwin River Coal Measures.

"We are now focusing on flow testing of Senecio-3 to establish commercial viability and the potential early, low cost development of the Senecio and Waitsia fields.

"If successful, this could deliver significant additional gas into the Western Australia domestic market and provide substantial value to AWE shareholders," Clement said.