Craig Spence finished one shot off the pace at Hyatt Coolum Resort. Corey Pavin, Greg Chalmers, Andrew Buckle, Gavin Flint, Adam Crawford, Wayne Perske, Dean Alaban and James Nitties share third place at 5-under-par 67.
Estes, a four-time winner on the PGA Tour, jumped out of the gate with a birdie at the 10th, his first. He then birdied four in a row starting at the par-5 12th and added a birdie at the par-4 18th to make the turn at minus-6.
The 38-year-old parred his next five holes before running off back-to-back birdies from the sixth. Estes then closed his round in style with a birdie at the par-4 ninth to complete a bogey-free day.
'Normally you get the wind out here and that is what I am used to,' said Estes, who matched the course record on Thursday. 'Obviously today was more calm, but I am not out here to enjoy a holiday I am here to win a golf tournament.'
Spence found trouble early with a bogey at the first but he responded with a birdie at the very next hole. The Australian then eagled the par-5 fourth and added birdies at eight and nine to reach 4 under around the turn.
He made it three in a row with a birdie at the 10th and Spence moved to minus-7 with two straight birdies starting at the 12th. Spence then birdied the 17th on his way to a round of 64.
Greg Norman tallied six birdies and two bogeys to finish five shots back at 4-under-par 68 along with Peter O'Malley, John Senden and Craig Parry.
Defending champion Peter Senior was one shot further back in a group at 3-under-par 69 that features Peter Lonard, who won the Australian Open last week.
Adam Scott was seven strokes off the pace after a round of 2-under-par 70.