The company, which holds 52,810 square kilometres in six onshore permits in PNG, is the largest acreage holder in what is being termed a new world-class hydrocarbon province, and has an active exploration program that will ramp up this year.

"The logistics preparation and rig mobilisation is in progress to commence drilling the target in May 2010," he said.

"A 100-kilometre trend of oil seeps has been identified on PPL 267.

"The Panakawa prospect surface seep, which lies in the centre of PPL 267, is flowing at 5 barrels a day. In 2008 the company acquired seismic over the Panakawa prospect which confirmed the drilling target for 2010."

The company's strategy for appraisal, development and exploration will focus on evaluating the oil seeps around mapped structures in PPL 267, while continuing programs on greenfield targets in other licence interests.

It is planning one well in PPL 268, one in PPL 269 and up to six seismic programs in PPLs 265, 266, 267, 268, 269 and 277 by the end of the year.

New Guinea Energy, which has a market capitalisation of $A149 million, is continuously reviewing more production and exploration acreage in the region to complement its current portfolio.

It has farm-in agreements with Talisman Energy Inc to fund seismic programs at a cost of $US11 million and up to a six-well program costing $US90 million over the next two years.

According to a research report prepared by Martin Place Securities: "NGE's portfolio has outstanding potential from past drilling results".

"Recent farm-in deals with Talisman Energy will allow additional wells to be drilled within the next six months.

"The arrangement with Talisman is likely to accelerate any development of NGE's assets, particularly those adjacent to Talisman's Stanley gas-condensate development project."

Disclaimer: Aspermont, publisher of PetroleumNews.net, holds shares in New Guinea Energy