METGASCO LTD — Capital/Financing Update 2005

Mar 31, 2005

1 April 2005

ALISTRALIAN STOCK EXCHANGE Via Electronic Lodgement

WEEKI Y DRILLING REPORT

Commencement of South Casino Drilling Program

Metgasco Ltd advises that drilling on the South Casino Trial Production program in PEL16 has commenced

The first well – MSCO-3 – is located 4 kilometers south of Casino and is targeting the Jurassic age Walloon Coal Measures. As at 11.00 today the well is being drilled to set BOP casing at 85 metres. This is in preparation for drilling to target depth of 670 metres. After total depth is reached the well will be wireline logged and completed for production test.

MSCO-3 is the first well in the initial six well drilling program.

Overview of Project

Metgasco holds 100% of PEL16 located near Casino and Lismore in northern New South Wales. The Company is appraising the gas production potential of the Walloon Coal Measures in the Clarence Moreton Basin. The Walloon Coal Measures have been the subject of successful exploration and development activity in Queensland over the past four years. The trial production program will comprise five production test wells and one core hole. The holes will be located between 200m and 600m apart and will consist of both single seam and multiple seam production completions to a depth of approximately 700m. The wells will be flow tested to establish gas production rates with the objective of reserve certification.

For further information contact: Glenda McLoughlin Chief Financial Officer Metgasco Ltd Tel: (02) 9363 9604 Fax: (02) 9327 4765

Metgasco Limited ACN 088 196 383 Suite 10/402 New South Head Rd Double Bay NSW 2025 Tel: (02) 9363 9604 Fax: (02) 9327 4765 Website: www.metgasco.com.au