Sun Resources NL (“Sun”) announced on the 7 May 2012 that it had entered into a Sale and Purchase Agreement (SPA) with Amerril Energy LLC (“Amerril”), the US oil subsidiary of Chinese Qingdao Kingking Group, to purchase a 50% working interest (WI) and 37.5% net revenue interest (NRI) in approximately 12,000 acres of oil and gas leases (approximately 6,000 net acres), located immediately adjacent to Sun’s existing Delta Oil Project. The initial proposed consideration was US$5,000,000 and 200,000,000 shares in Sun issued at A$0.05 per share. On the 4 November 2012, the operator, Amerril, commenced a multi-well drilling programme in the SW Leona Oil Project leases. Two horizontal wells and one vertical well were drilled in the December 2012 Quarter and the March 2013 Quarter, with Sun having 50% WI in both wells. The Seale #1 vertical well was the first well to be drilled, logged and sampled as a ‘pilot hole’ a final total measured depth (MD) of 9,938 feet in the Glen Rose Formation and a complete set of wireline logs was run. The logs identified potential hydrocarbon pay in multiple stacked formations: Sub-clarksville; the Woodbine, and the Glen Rose Formations. The Seale #1 vertical well was cased for future fracking and ‘multi-zone’ production. The T. Keeling #1H was drilled in a northerly trajectory to maximise the length of the lateral while remaining within the boundaries of the lease and cased to a depth of 14,400 feet, delivering almost 6,400 feet of lateral in the Woodbine Formation. Excellent oil and gas shows were observed while drilling along the length of the lateral and these strong oil shows were supported by ‘thru-bit’ logging of the lateral by the Operator, Amerril, after drilling was completed. The rig was then ‘skidded’ a few meters to permit spudding of the Seale #1H horizontal well location on the 19 January 2013. The operator, Amerril, completed the drilling of the second Woodbine horizontal well in the project area, Seale #1H, during the March 2013 Quarter. The total lateral section drilled was 7,100 feet and during April 2013 Amerril completed a multi-stage fracking operation on the lateral, with 23 stages successful across a total horizontal section of 6,800 feet. A number of weeks of initial clean-up and flow-back followed, before the well was shut in for safety reasons so the fracking of the T. Keeling #1 H well could occur. The T. Keeling #1H lateral well was fracked in July 2013 after the completion of the initial flow-back activities in the Seale #1H horizontal well. A 5-stage test frack programme was conducted and oil recovered during flow-back. The project area currently comprises of 480 acres net to Sun. Sun assumed operatorship of the SW Leona Oil Project during July 2015. During the reporting period, Sun announced that cumulative oil production at the Seale #1H Lower Woodbine well was approximately 5,509 barrels of oil. The Seale #1H unconventional well continues to produce at approximately 15-20 barrels oil per day (100% working interest, before taxes and royalties).