Operations Update

RNS Number : 6310X

Tower Resources PLC

09 December 2010

 



PRESS RELEASE                                                                                                                                                                          

9 December 2010

Tower Resources plc

("Tower" or the "Company")

OPERATIONS UPDATE

Tower Resources plc (AIM:TRP), the oil and gas exploration company with interests in sub-Saharan Africa, principally in Namibia and Uganda, is pleased to provide an update to shareholders on its current operations in each country, managed by wholly-owned subsidiaries Neptune Petroleum (Namibia) Limited and Neptune Petroleum (Uganda) Limited.

Namibia

In Licence 0010, offshore Namibia, where Neptune Petroleum (Namibia) Limited has a 15% carried interest, processing of the 3-D seismic is about 65% complete and data quality is confirmed by the seismic processing contractor to be excellent. Detailed interpretation to evaluate apparent direct hydrocarbon indicators will begin in February 2011. Activities by the operator, Arcadia Petroleum Limited, to put in place funding and to contract a deep water drilling rig will begin in earnest once the seismic processing is complete. The precise timing of a first well will depend on the success of these activities but drilling during the next favourable operating window, October 2011 to March 2012, remains the operational target.

Uganda

Final interpretation studies of the aero gravity gradiometry survey (GGI) over Licence EA5 are complete, together with an updated interpretation of the basin supported by detailed analyses of all well data. The results are positive (see attachments) in demonstrating the probable existence of an active oil generation kitchen as indicated by the widespread presence of near mature oil encountered as micro seeps close to surface and as trace amounts in the water samples picked  in the two wells. The GGI has also identified an apparently closed structural feature having an area greater than 100 square kilometres, in a location where basin modelling projects that good quality reservoir should be present. The limited sections of existing seismic coverage here show that the prospective reservoir interval maintains its thickness over the structure, in contrast with the setting of the recent wells, both of which were drilled where the reservoir interval was thinning on to the structurally high points of the prospects.

Sedimentological studies confirm that both wells were probably marginal to the main fluvial deposition region early in the basin history. Scanning Electron Microscope and X-Ray Diffraction observations have shown that high porosity sandstones have had pore throats choked by detrital clay. Formation fluid data samples from Avivi-1 have allowed a much improved interpretation of electric log and wireline pressure data at Iti-1. A mobile oil phase in Iti-1 still remains a possibility with calculated oil saturation between 15% and 35%. This would be consistent with oil in a reservoir having low effective porosity and permeability.

In summary, there is an improved likelihood that there is a large structurally high area, suitably placed to contain good quality reservoirs, on a probable direct migration path from a significant hydrocarbon generating kitchen. This structural area is expected to have a number of discrete closed prospects and one of these is expected to be the target for a third well. All of the outstanding questions about the Licence now have a plausible explanation. The quality of the GGI interpretation now points to a focused seismic survey targeted at the newly defined structural high and its surrounding area. A seismic programme of 150-200 kms is now being planned with targeted timing of an April 2011 start and duration of about one month.

All of the information required by potential farm in partners is now available. A final phase of the farm out programme has now begun and the next two months will determine current third party interest in funding the remainder of the Uganda commitment operation. Several companies have continued to express an interest, contingent on receipt of the updated technical information.

Peter Kingston, CEO of Tower Resources, commented: "Our Namibia interest continues to progress within schedule and I am delighted with the excellent data quality from the 3-D seismic survey. In addition, further interpretation of data relating to our Uganda interest points to an improved likelihood of a significant oil generation kitchen and good quality reservoirs within this licence area."

For more information on Tower Resources, please visit; www.towerresources.co.uk

Contacts:

Tower Resources plc	www.towerresources.co.uk
Peter Kingston, Chairman	07802 804852
Northland Capital Partners Ltd (NOMAD and Joint Broker)
Gavin Burnell / Shane Gallwey	020 7492 4750
Charles Vaughan (Broking) Westhouse Securities (Joint Broker) Tim Feather / Matthew Johnson Walbrook PR	0207 601 6100
Bob Huxford	020 7933 8780

 

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