Lakes Oil Ltd was granted the SA Territorial Waters permit EPP SA-2 for 6 years on 2 November 1992, to explore an offshore area approximately 45 km long and up to 5 km wide adjacent to the South-East coastline south of Mount Gambier. Because the area lay beyond the boundaries of previous offshore and onshore exploration tenements in the region, there was very little seismic and no well data available locally, although promising structures and drillhole hydrocarbon showings existed nearby. Thus the permittee was required to integrate and then apply to the area regional offshore and onshore data including seismic, wells, geochemistry and basin depositional models. In addition, during permit Year One portion of a new regional aeromagnetic survey was acquired, processed and interpreted in conjunction with the SA government as part of the SAEI program. Logistical and cost difficulties associated with shallow-water shipborne exploration methods such as planned Year Two seismic and geochemical surveys, plus the disappointing drilling results from Lakes Oil' Northumberland 1 wildcat in adjoining onshore PEL 57, served to downgrade the perceived viability of EPP SA-2, and the permit was relinquished in good standing.