Ascent Resources Regulatory News (AST)

23 Aug 2006 14:00

Ascent Resources PLC23 August 2006 Ascent Resources plc / Epic: AST / Index: AIM / Sector: Oil and Gas 23rd August 2006 Ascent Resources plc ("Ascent" or "the Company") Farm out and Drilling Operations Ascent Resources plc, the European focused oil and gas exploration andproduction company, through its 90% owned Joint Venture PetroHungaria kft, hasentered into a farm-out agreement with DualEx Nyirseg Inc. ("DualEx"), a whollyowned subsidiary of DualEx Energy International Inc. of Canada (TSX-V: "DXE").The companies will jointly explore and develop the hydrocarbon resources of theNyirseg Del and Nyirseg Szatmar exploration permits in the Pannonian Basin inNorth Eastern Hungary. Under the terms of the Agreement, DualEx will reimburse some of the historicalexploration costs and fund 75% of the costs of drilling two wells to earn a37.5% working interest in 45% of the area of the Exploration Permits. DualExalso has the option to participate in two further wells to earn a 37.5% workinginterest across the whole of the two permits. The first well, Peneszlek-104 (PEN-104) is a re-appraisal well for the Peneszlekfield and has a secondary target in Pannonian sandstone formations. The secondwell, Fehergymat-1 (FGY-1), targets a gas prospect also in the Pannonianformations. The FGY-1 well with a planned depth of 1,100m is to be drilledimmediately after the PEN-104 well, scheduled to commence drilling in Septemberto a depth of 1,350m. The Peneszlek field produced a total of 4.8 Bcf of gas from 1983 to1989 from sixwells. The gas reservoir is in Miocene tuff sediments. Following re-mappingusing the seismic data acquired in 2005 by PetroHungaria, it is anticipated thatthe remaining reserves of this field are substantially more than previouslyestimated and redevelopment studies are on-going. During the 1980's twosatellites of the Peneszlek field were discovered and tested gas but were notput on production at that time. The first optional well is planned as an appraisal of one of these Peneszleksatellite discoveries; the second optional well targets a seismically defined(AVO) prospect in the Pannonian sandstones in the south of the permits. Ascent has also received a Letter of Intent from a Swedish Company PetroPequniaAB which seeks to enter in to an agreement under the same terms to farm-in for a5% working interest by funding a further 10% of the cost of the drilling. Besides these operations in Hungary, Ascent has four other wells planned forItaly and Spain. Despite delays caused both by permitting and the shortage ofequipment and services, the Company has, through its Italian subsidiary,contracted a rig to drill the Anagni-1 and Arrone-1 wells in the Frosinonepermit of the Latina Valley and the Fiume Arrone Permit near Rome's Fiumicinoairport. Following the drilling of these two wells it is planned to move thesame rig to Spain for the drilling of the Hontomin 4 appraisal well. Subject toreceiving final authorization, the rig is expected on location to commencedrilling the Anagni-1 well in October 2006. The Tozo-1 re-entry will useanother rig which is currently working on wells in the Ayoluengo oilfield inSpain. Ascent Managing Director Jeremy Eng said: "The farm-out agreement in Hungaryallows us to fast-track the exploration and development of the Nyirseg Permitsand Peneszlek gasfield. DualEx is a great partner for PetroHungaria bringinginvaluable experience and a Canadian operating philosophy to the project. TheHungarian farm-out generated considerable interest and served as a peer groupreview to validate our seismic interpretation and geological model. "I am also very pleased that we have the possibility of an additional two wellsto be added to our six well drilling campaign, and that two rigs are nowavailable to us to start drilling next month." * * ENDS * * For further information visit www.ascentresources.co.uk or contact: Jeremy Eng Ascent Resources plc Tel: 020 7251 4905Hugo de Salis St Brides Media & Finance Ltd Tel: 020 7242 4477 Notes Ascent Resources has an extensive portfolio of over 20 oil and gas projectsacross six countries in Europe. These include an 88% interest and operatorshipof the only onshore Spanish oilfield which produces over 100 barrels of oil perday. Ascent's other projects are in Italy, Switzerland, Hungary and Romania, aswell as applications offshore Netherlands. Starting late this summer Ascent willdrill six (with two optional extra) exploration wells, two (or four) in Hungaryand two each in Spain and Italy. In 2007, high impact gas exploration wells areplanned in the Po Valley in Italy and in Switzerland. The Company will alsoparticipate in up to four non-operated exploration wells in the Aurelian ledproject in Romania (5% Ascent) from which gas production and sales from theBilca development are to commence shortly. With the strong and stable European gas market, the Company's portfolio isbalanced in favour of gas over oil, and with the exception of Netherlands,projects are located onshore where operating and development costs are much lessthan they are offshore. The Company has appointed to its Board a team of experienced directors who arespecialists in the European energy business and each of whom has expertise andexperience in commercialising energy assets. This provides the structure underwhich the Company can accommodate the rapid growth that will accompany adiscovery made during this year's drilling campaign. This information is provided by RNS The company news service from the London Stock Exchange