Last checked at 18 Jul 2008 09:45
Roxi Petroleum Plc
('Roxi' or 'the Company')
Operations Update /AGM Statement
At the Company's AGM today , the Chairman, Clive Carver, will provide the following statement.
Update on funding
The board is pleased with the progress to date in its discussions with a number of potential funding partners.
The amounts sought would provide significant additional funding required to develop the company's existing portfolio of assets for 2008 and 2009, including drilling and seismic operations designed to increase reserves and look to gain early production. The funds sought would also assist with the acquisition of ADA and ADA Oil, in the event the ADA option agreement is exercised.
In the meantime the board has taken steps to reduce expenditure pending the receipt of new funds and is closely monitoring its cash balances.
Further announcements on funding will be made in due course.
Drilling Results and Operations Update
Roxi is pleased to announce the following results from its ongoing operations in the following contract areas
Galaz Contract Area (NW Konus Oilfield)
Well # NK1*: The well was drilled successfully to a total depth of 1425 metres. After open hole logs were analyzed, production casing was set and cemented at a depth of 1358 metres. Two prospective intervals were identified in the Cretaceous with a combined potential net pay of 11 metres and an average porosity of 18%. A workover rig has been moved onto the well and an 8 metre interval has been perforated and swabbing operations are being conducted. Initial test results are expected in the next 30 to 60 days.
Results from this well will be evaluated prior to drilling the second well of the five well drilling program.
*Note: in previous releases, this well was titled as "Well #31". It is now shown as "Well # NK1" to conform to state registration documents.
Test Production from Well # 26 and 27:
After re entry operations were completed, Well #27 was put into clean-up test production using a Progressive Cavity Pump on May 18th, 2008. Currently the well is averaging 60 barrels of oil per day with associated water cuts of 70 % to 50%. Testing will continue on this well.
After re entry operations were completed, Well #26 was put into clean-up test production using a Beam Pumping Unit on June 8th, 2008. The well flowed at initial rates of 10-50 barrels of oil per day with associated water cuts of 50 % to 90%. The well has been shut-in waiting remedial work-over to shut off water production.
The oil is being trucked to a pretreatment facility and sold to the domestic market as required by the Kazakhstan Ministry of Energy and Mineral Resources (MEMR) at a price of approximately US$37 per barrel.
Beibars Contract Area
The 3D seismic survey was completed on 4th June 2008 after receiving permission from the Western Kazakhstan Regional Military Division to allow the acquisition of the seismic data. The data has now been sent to Veritas Company for processing. The initial processed data is expected to be completed in 60 days.
Discussions with the Aktau Akimat Office and the Kazakhstan Ministry of Defense are continuing regarding the use of the surface area on the block. It should be noted that the Military polygon for training exercises encompasses the active adjoining Oimasha Oilfield and allows the current operator of that field to continue work without interruption.
Ravninnoe Contract Area
Well #5: The ongoing re entry operations have reached the target depth. However, during logging operations, it is clear that the casing is damaged at a depth of 3195 metres, which is above the targeted Carboniferous formation. The initial cased hole logging operations were completed. The well has been suspended pending testing of shallower potential in the Triassic.
BNG Contract Area (Aryshagyl)
The contract for the initial 3D Seismic Survey has been awarded to KazGeoCo, the same company that has recently completed the Ravninnoe and Beibars seismic work. The total area to be surveyed is approximately 370 km2 on the Northern part of the block. Work is expected to begin in late August or September 2008.
Munaily Contract Area
Well # H-1 has successfully completed testing at approximately 100 BOPD. An application to reduce the capital expenditure program for the next two years in order to allow Munaily LLP to apply for a pilot production project has been submitted to the Kazakhstan Ministry of Energy and Mineral Resources.
Presentation:
The board will also make a presentation at the AGM. This will be available on the Company's website at www.roxipetroleum.com
Qualified Person
Duncan McDougall, Technical Director of Roxi Petroleum and a Fellow in the Geological Society, London, has reviewed and approved the technical disclosure in this announcement. He holds a BSc in Geology and has 25 years international experience of exploration, appraisal, and development of oilfields in a variety of environments.
Enquiries:
| Roxi Petroleum Plc | Clive Carver | Tel: +44(0) 20 3008 2500 |
| College Hill | Paddy Blewer/ Nick Elwes | Tel: +44(0) 20 7457 2020 |
| W H Ireland Ltd | James Joyce/David Porter | Tel: +44(0) 20 7220 1666 |