Baron Oil Regulatory News (BOIL)

5 Jun 2007 07:01

Gold Oil PLC05 June 2007 FOR IMMEDIATE RELEASE 5 June 2007 Gold Oil plc Award of Rosa Blanca licence block onshore Colombia Highlights •Award of 90% Interest in 45,000 Ha block, Rosa Blanca •Drill to ready, subject to EIA Gold Oil Plc ("Gold") is pleased to announce that it has received confirmationfrom Agencia National de Hydrocarburos ("ANH"), the Colombian NationalHydrocarbons Agency, that Gold has qualified as operator and licence holder forthe Rosa Blanca block ("Rosa Blanca Block") in the northern part of the MiddleMagdalena Basin, onshore Colombia. The Rosa Blanca Block covers an area of approximately 45,000 hectares ("Ha") andis surrounded by the nearby oil producing fields of Cristalina, Santa Lucia,Tisquirania, Totumal, Baturama and the South Bolivar Block. The most attractive oil play within the Rosa Blanca Block has a geologicalstructural trap of a faulted anticline of 300 feet of vertical closure of 12,699Ha, between 3,900 and 4,200 feet which Gold has interpreted to have the samegeological signature of the nearby Buturama oil field. There are 232 kms of 2Dseismic available to Gold over this prospect which ties into the nearby Norean 1well. Gold believes that there are up to three other plays on this block. The petroleum system within the Rosa Blanca Block has been proved in nearby oilwells and fields which reduces the geological risk significantly. Gold believesthat the prescence of the fractured reservoir zones within the reservoir rock isthe main operational risk. Gold's clear objective is to find another Buturamaoil field, which by analogy, could give reserves of up to 30 MM STB and initialproduction rates of 1,200 BOPD of 35 API gravity oil. The main prospect is ready to drill to a depth of 5,000 feet with an expecteddrilling budget of $1.6 - $3.0MM, depending on testing and rig rates. Gold has90% of the licence but pays 100% of the costs. Gold's 10% partner is a localcontractor who has extensive experience working in the Middle Magdalena Basin. Under the terms of the agreement with our partner, he is carried through thedrilling and testing of the first well, with the cost of the carry repaid toGold out of future production revenues. Under the licence terms with ANH aroyalty of 8% is payable and corporation tax is levied at 35%. Commenting from South America on these developments, Gary Moore, ManagingDirector of the Company said, "We are delighted to be awarded the Rosa BlancaBlock following the lodging of our application to ANH in September 2006. Thedelay in Gold receiving confirmation of its successful application can beexplained by the increasing competition from existing oil and gas companies andnew entrants in Columbia. This high level of industry interest demonstrates theattractiveness of Colombia as an oil and gas province, with knock-on licensingdelays at ANH due to the high volume of applications. Gold will now commencework with an environmental impact assessment ("EIA") which will be carried outin parallel with selecting drilling locations and negotiating and securing thedrilling contract to fast track the programme." The technical information contained in this announcement has been reviewed andapproved by Mike Burchell, B.Sc., 66, member of the SPE and with over 44 yearsexperience in the oil and gas business. Enquiries: Gary Moore Managing Director Tel: +44 (0)1737833597Email: gmoore@goldoilplc.com Mike Burchell Chairman Tel. +44 (0) 1372361772Email: mikeburchell@hotmail.com Roland Cornish Beaumont Cornish Limited Tel: 020 7628 3396 Information on Gold Oil Gold Oil plc is a UK oil and gas exploration company primarily focused onopportunities in Central and South America. The company listed on the AIM marketin July 2004 under the symbol GOO.L. The company has oil production in Spain andColombia and significant exploration acreage and licence applications, bothonshore and offshore, in both Colombia and Peru. Further details of the Gold OilPlc operations together with recent drilling results from its onshore PeruvianBlock XX1 as well as the recent award of offshore Peruvian Block Z34 can befound on the company's website www.goldoilplc.com. This information is provided by RNS The company news service from the London Stock Exchange