MoU Signed with Chevron Lummus Global

RNS Number : 6293Y

San Leon Energy PLC

28 January 2014

 



28 January 2014

Timahdit Oil Shale, Morocco

MoU Signed with Chevron Lummus Global

San Leon Energy Plc ("San Leon" or "the Company"), has signed a Memorandum of Understanding ("MoU") with Chevron Lummus Global LLC ("CLG"), to exclusively cooperate in respect of the oil shale upgrading technology required to produce high quality synthetic crude oil from the raw shale oil to be produced in the Company's Timahdit oil shale License Area, Morocco. 

The MoU will result in a detailed evaluation by CLG focused on implementing proven proprietary CLG technology on the raw shale oil produced at the proposed Timahdit Plant to be designed and delivered in cooperation with Enefit Outotec Technology ("EOT", see also www.enefit.com/eot), a joint venture of the world's leading oil shale energy company Enefit and mineral and metals processing technology group Outotec. The proposed Timahdit Plant, as described in the Initial EOT Evaluation Study, will be built using the latest "Enefit280" process and EOT's experience.

Chevron Lummus Global will propose a design for an Oil Shale Upgrading unit to produce high quality synthetic crude oil which will then be refined locally. CLG has already licensed its hydrocracking technology to the Samir Refinery in Mohammedia, Morocco.

The Initial EOT study proposes that the Timahdit Plant will have three (3) "Enefit 280" units. The Plant will be designed with the ability to increase capacity to exploit the Estimated resource of 600 million bbl of shale oil within SLE's Timahdit License area as suggested by historical data and confirmed by the EOT study.

SLE is currently conducting a core drilling operation to extract samples from the Timahdit oil shale deposit for testing at the Enefit Bench Scale plant located at EOT's R&D centre in Frankfurt, Germany. The results of these tests are expected to be available in Q2 2014.

An updated feasibility study for the Timahdit Oil Shale project is currently planned to be completed by year-end. This will facilitate the completion of project finance to fund  the construction of the proposed plant envisaged to begin after 2015. Initial reactions from financial institutions have been very encouraging based on the strong interest in investing in Morocco's energy future.

In August 2013, San Leon was offered exclusive rights to the 36 km² Timahdit Oil Shale License for two years to evaluate the commercial viability of a surface retorting project on the prolific Timahdit oil shale deposit. Timahdit's shale oil yield in the awarded area is considered to be the highest in Morocco with an average of 100 l/t in the rich layers and has significantly less moisture content than many other international oil shale deposits. The project will also include power generation facilities.

Executive Chairman, Oisin Fanning commented,

"I very much welcome CLG as our upgrading partner in the Timahdit project. CLG is a world leader in upgrading technology who brings real strength to our team. Our continued cooperation with our existing partners, ONHYM in Morocco, along with Enefit and now CLG, brings further credibility to San Leon's commitment to commercially develop oil shale in Morocco."

Chevron Lummus Global, LLC provides engineering and technical services; licenses proprietary technology; and supplies catalysts to industrial and commercial customers primarily in the oil, gas, and petrochemical industries worldwide. The company offers services that relates to solutions for converting/upgrading heavy and residual components in heavy/sour crude oil into useable products. Its proprietary technology consists principally of hydroprocessing technologies, including hydrocracking and hydrotreating processes that are used by refineries to process petroleum-based products. Chevron Lummus Global, LLC was founded in 2000 and is based in Richmond, California.  

Further Information
Enquiries:

San Leon Energy plc
[phone]
Oisin Fanning, Executive Chairman

Fox-Davies Capital Limited
[phone]
Daniel Fox-Davies
Oliver Stansfield
Jonathan Evans

Macquarie Capital (Europe) Limited
[phone]
Steve Baldwin
Nicholas Harland

FirstEnergy Capital LLP
[phone]
Hugh R. Sanderson
Jonathan Wright
David van Erp

Westhouse Securities Ltd
Nominated Adviser
[phone]
Richard Johnson
Antonio Bossi

Vigo Communications
Financial Public Relations
[phone]
Patrick d'Ancona
Chris McMahon

College Hill
Investor Relations Adviser
[phone]
David Simonson
Catherine Wickman

Plunkett Public Relations
Sharon Plunkett
[phone]

Qualified person

Joel Price, who has reviewed this update, has 20 years' experience in the oil & gas industry and is a member of the Society of Petroleum Engineers. He holds a BA in Natural Sciences from Cambridge University, an MEng from Heriot-Watt University, and an MBA from Durham University. Joel is Chief Operating Officer for San Leon Energy and is based in San Leon's London office.

 

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