Sound Oil PLC
28 February 2007
28 February 2007
Sound Oil plc
("Sound Oil" or the "Company")
Operations Update
Sound Oil announces the following operational updates:
Citarum Production Sharing Contract - Java, Indonesia
Preparation is in its final stages for Pasundan No. 1, Sound Oil's first well.
The Great Wall Drilling Company Rig 93, the Company's preferred drilling rig, is
currently mobilizing from East Java to the laydown area close to the wellsite in
West Java. Despite the very wet conditions the mobilisation is 95% complete. The
rig will be handed over to the operator shortly, following routine certification
by the Indonesian authorities at the end of the current extensive overhaul.
Pasundan No. 1 is expected to commence drilling on 28 March although this may
slip a few days if the remaining critical rig items from China are not on site
by early March. The current operation is setting the 30 inch conductor pipe
prior to spudding the well.
The wellsite has suffered from the local extreme weather conditions and some
land slippage has occurred which will require 7 days remediation prior to
drilling. Some concrete piling of the site will be needed during drilling
operations.
Pasundan No. 1 well is programmed to a total depth of 10,322 feet with a
prospective objective at approximately 6,300 feet and deeper target horizons
below 8,500 feet.
A second well, Kujang No. 1, will be drilled back to back with Pasundan and will
be located on a separate structure some 8 km to the north.
Prospective recoverable resources for the Pasundan and Kujang prospects are 255
and 322 billion cubic feet of gas respectively (P50 cases*).
It is anticipated that an $11 million dollar 2D seismic programme extending to
850 km will be acquired during the year, over a number of prospective areas
across the Citarum acreage.
Sound Oil holds a 20% interest in BPREC, the 100% owner and operator of the
Production Sharing Contract.
Bangkanai Production Sharing Contract - Kalimantan, Indonesia
The Company has recently undertaken seismic interpretation studies over the
Kerendan Gas Field area in the central part of the Bangkanai PSC. As a result, a
large new prospect has been identified underlying the existing Kerendan
Limestone gas accumulation. The new prospect may contain up to 540 billion cubic
feet (P10*) of recoverable gas resources. A future well will be designed to pass
through the known Kerendan Limestone gas accumulation at 9,000 feet, containing
reserves of 238 billion cubic feet (Proven + Probable), on its way down to the
deeper prospect at around 14,000 feet.
It is anticipated that a new seismic programme will be acquired over a number of
areas during the summer including the Kerendan Gas Field, the potentially large
Jupoi prospect and a number of leads
Sound Oil plc has a 34.99% interest in the license through its wholly owned
subsidiary Mitra Energia Ltd.
Option award
The Board of Directors have today granted options over the Company's ordinary
shares as follows: Dr Orbell, 2,000,000; Mr Rachmantio 1,250,000; Mr Heath
1,000,000. The options' exercise price will be that of Sound Oil's market price
per share at today's close. The options will be vested yearly in 33.3% tranches
during the next three years and expire in ten years.
Dr Michael J Cope, Head of Exploration, Sound Oil plc, has reviewed and approved
the operational update information contained in this announcement relating to
Sound Oil's Citarum and Bangkanai PSCs. Dr Cope holds BSc and PhD degrees in
geology from the University of London and has been a member of the American
Association of Petroleum Geologists since 1987 and is a Fellow of the Geological
Society of London.
* Prospective resources, consistent with SPE (The Society of Petroleum
Engineers) guidelines, are quantified in terms of the statistical probability to
find a given recoverable hydrocarbon (oil or gas) volume in a prospective
structure considering all the geological variables involved. The P50 figure
indicates a 50% chance of finding a given volume and is generally considered as
the best estimate. The P10 figure indicates a 10% chance of finding a given
volume and is generally used to express the high estimate.
Further information on the Company's operations is set out in a presentation
which may be downloaded from Sound Oil's website:
http://www.soundoil.co.uk/news/presentation.pdf
Contacts:
Tim Thompson, Buchanan Communications
Tel + 44 (0) 207 466 5000
Gerry Orbell, Sound Oil plc
Tel +44 (0) 7903 861145
This information is provided by RNS
The company news service from the London Stock Exchange
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