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The Casterton area of the north-west margin of the Otway Basin contains thick Mesozoic and Tertiary sediments along a shoreline composed of Cambro-Ordovician metamorphics and associated intrusives. Subsurface and structural information has been gained from two deep wells and a structure drilling programme, and from reflection and refraction seismic work. A large structure has been outlined which is at present being drilled by a third deep well, Casterton No. 1.The Mesozoic sediments are represented by an Upper Cretaceous unnamed sand unit overlying the Paaratte Formation and by the Lower Cretaceous Merino Group. The Merino sediments have been divided into seven lithological units in the Heathfield No. 1 well, the upper four of which can be correlated with intervals in the Tullich No. 1 well. Below Unit 4 is an unconformity apparent from dipmeter surveys.The Merino Group consists of mudstones, siltstones, sandstones and shales. The coarser sediments vary from lithic sandstone, through lithic greywacke to calcareous sandstone, and also include some replacement limestone. They contain considerable volcanic detritus, as well as lithic grains derived from adjacent basement areas. Plant fragments and carbonaceous materials are common. The sediments were deposited in a near-shore, shallow-water, marginal marine environment.Structurally the area has been influenced mainly by vertical tectonics. Structure drilling and refraction seismic show that this faulting is not responsible for the Kanawinka escarpment in the Casterton area. Large basement faults with a throw of up to 6,000 feet exist to the north-east of the Kanawinka escarpment.

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