Operational Update
Petroneft Resources PLC
19 June 2007
19 June 2007
PetroNeft Resources plc
Operational Update
PetroNeft Resources plc ('PetroNeft' or 'the Company'), 100% owner of Stimul-T,
which is the sole owner and operator of Licence 61, Tomsk Oblast, Russian
Federation, is pleased to provide this update on the progress on its 2006/07
three well drilling programme.
• Positive initial drilling results from Tungolskoye No. 4 delineation well.
• High impact exploration well Lineynoye No. 7 has been spudded.
Tungolskoye No. 4 Well
The Tungolskoye Oil Field is located in Licence 61 in the Tomsk Region of the
prolific Western Siberian Oil and Gas Basin. Discovered in 1973, Ryder Scott
petroleum consultants estimate 2P reserves of 17.92 million barrels of oil for
the field.
• The Tungolskoye No. 4 well was spudded on 16 May 2007 and reached
Total Depth of -2,900 metres subsea on 15 June.
• Oil was confirmed in the primary reservoir interval comprising over 15
metres of continuous net pay in the Upper Jurassic Vasugan Formation. This
represents the single best reservoir interval drilled to date on Licence 61. The
entire reservoir interval was successfully cored and these cores are currently
being analysed in detail.
• The Base Bazhenov Formation was penetrated at -2,505 metres subsea
which is in good agreement with the seismic interpretation prior to drilling the
well. The data indicates that the oil water contact (owc) is consistent with
the current field wide owc at -2,526 metres subsea.
Geophysical logging and initial petrophysical analysis has now been completed
and preparations are now underway to carry out flow tests on the well to
determine its productive capacity. Results will be published as soon as they
are available.
Lineynoye and Tungolskoye Drilling Programme
The current appraisal drilling programme which comprises two wells, the recently
completed Lineynoye No. 6 well and Tungolskoye No. 4, is designed to confirm
prior reservoir data in the Lineynoye and Tungolskoye fields and to provide
further input into a Final Development Feasibility Study. The programme also
includes a high impact exploration well, Lineynoye No. 7, on the West Lineynoye
Prospect. These results will also be incorporated into the Final Development
Feasibility Study expected to be completed in late 2007.
West Lineynoye Prospect - Lineynoye No. 7 Well
The Lineynoye No. 7 Well was spudded on 18 June 2007. West Lineynoye, a high
impact prospect, is estimated by Ryder Scott to contain Possible Reserves of
approximately 67 million barrels of oil. The principal target horizons for this
well are Upper Jurassic sandstone reservoirs starting at a depth of about -2,375
metres subsea. The total planned depth for the well is approximately -2,750
metres and it is anticipated that the well will be drilled, logged and tested
within approximately 70 days of commencement.
Dennis Francis, Chief Executive Officer of PetroNeft Resources plc commented:
'We are delighted with the initial results from the Tungolskoye No. 4 well.
This result confirms the presence of a significant and continuous reservoir
interval and supports the current structural and hydrodynamic interpretation of
the field.
The 15.2 metres of continuous net pay represents the single best reservoir
interval drilled to date in the Licence area and is an important input into our
ongoing development and production feasibility planning work.
We look forward to positive flow test results from Tungolskoye No. 4 and the
drilling of Lineynoye No. 7 which could bring significant new reserves into our
portfolio.'
For further information, contact:
Dennis Francis, CEO, PetroNeft Resources plc
+1 713 988 2500
Desmond Burke, Director Investor Relations, PetroNeft Resources plc
+353 52 53226
John Frain/Brian Garrahy, Davy
+353 1 679 6363
Nick Elwes/Paddy Blewer, College Hill
+44 207 457 2020
Damien Mauvais, Natixis
+44 207 220 5184
The information contained in this announcement has been reviewed and verified by
Mr. Dennis Francis, Director and Chief Executive Officer of PetroNeft, for the
purposes of the Guidance Note for Mining, Oil and Gas Companies issued by the
London Stock Exchange in March 2006. Mr. Francis holds a B.S. Degree in
Geophysical Engineering and a M.S. Degree in Geology from the Colorado School of
Mines. He has also graduated from the Harvard University Program for Management
Development. He is a member of the American Association of Petroleum Geologists
and the Society of Exploration Geophysicists. He has over 34 years experience
in oil and gas exploration and development.
Glossary of Key Technical Terms
Bazhenov Formation - Organic rich shale of Upper Jurassic age that is both a
major source rock for oil and cap rock in the West Siberian Oil and Gas Basin.
The base of the formation is a continuous and reliable seismic marker throughout
the basin.
J11 and J12 Sandstones - Stratigraphic units in the top part of the Vasyugan
Formation of Upper Jurassic age in the West Siberian Basin. The Vasugan
Formation underlies the Bazhenov Formation and the J11 and J12 sandstones are
normally of reservoir quality in the region with sufficient porosity and
permeability to store and transmit hydrocarbons.
Oil Water Contact - A bounding surface in a reservoir above which predominately
oil occurs and below which predominately water occurs.
Subsea or Relative Depth - represents the vertical depth of the well bore below
a reference datum taken as mean sea level. In mathematical terms this depth is
equal to the True Vertical Depth (TVD) of the wellbore minus the elevation of
the drill floor or measurement reference point.
Forward Looking Statements
This announcement contains forward-looking statements. These statements relate
to the Company's future prospects, developments and business strategies.
Forward-looking statements are identified by their use of terms and phrases such
as 'believe', 'could', 'envisage', 'potential' 'estimate', 'expect', 'may', '
will' or the negative of those, variations or comparable expressions, including
references to assumptions.
The forward-looking statements in this announcement are based on current
expectations and are subject to risks and uncertainties that could cause actual
results to differ materially from those expressed or implied by those
statements. These forward-looking statements speak only as at the date of this
announcement.
End
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