Caspian Sunrise Regulatory News (CASP)

Roxi Petroleum PLC

("Roxi" or the "Company")

Update on Operations at BNG

Roxi, the Central Asian oil and gas company with a focus on Kazakhstan, is pleased to further update the market with news of progress at its flagship BNG asset.

Deep Wells

Deep Well A5

As previously announced Deep Well A5 was drilled to a depth of 4,442 meters. Unrecovered drilling fluids have blocked the well during preparation for testing but for a brief period of up to two hours at a time the well flowed oil at the rate of 2,000 barrels of oil per day ('bopd') before becoming blocked by the accumulation of unrecovered heavy drilling fluids becoming set in the oil pipe.

The current position is that oil is being recovered intermittently, together with unrecovered drilling fluids, as the well is opened and closed. The continuing presence of the unrecovered heavy drilling fluids blocks the well after a few hours flow and has to date prevented unrestricted flow testing.

This problem is the result of the extremely high pressure encountered in drilling the well and the associated requirement to use extremely dense drilling fluids to control that pressure.

Well pressures in the casing are recorded at up to 280 bar with pressures in the well pipe varying from zero after a blockage to 200 bar as the natural pressure in the well builds then clears the blockage.

Typically the wells have been opened when the pressure in the drill pipe exceeds 85 bar, with 5 day periods closed while pressure in the oil pipe builds to a level it flows through the blockage.

The quantity of unrecovered drilling fluids in Deep Well A5 is finite and management's expectation is that as these fluids come to the surface the periods of oil flow should increase until finally the oil flows naturally on an unrestricted basis.

Deep Well 801 

Three intervals have been perforated at Deep Well 801 and oil has flowed from each.

The intervals perforated are a 14 meter interval starting at a depth of 4,910; a 20 meter interval starting at a depth of 4,842 meters; and a 22 meter interval starting at a depth of 4,726 meters.

However, although the pressures encountered at Deep Well 801 are not as great as at Deep Well A5 the existence of unrecovered drilling fluids has also caused blockages in this well during the testing of each interval such that to date the Company has not been able to conduct unimpeded flow testing.

After taking specialist advice Roxi's management believes the best way to tackle the issue of unrecovered drilling fluids in Deep Well 801 is via a prolonged wash using less dense mud injected under pressure, intended to lessen the density of the drilling fluids and ease their recovery. Work in this regard has already commenced.

Deep Well A6

As previously announced Deep Well A6 was spudded in early November 2015 and is to be drilled to a planned total depth of 5,000 meters.

Roxi is pleased to announce that drilling of this well has passed 1,350 meters without incident and work is on track such that the 5,000 meters total depth should be reached as planned by the end of February 2016.

Shallow Wells

Shallow Well 143

Well 143, which was the first of the shallow wells for 2013, was spudded on 1 April 2013, on the MJ-F structure located towards the North of South Yelemes field at BNG. The total depth of the well is 2,750 meters.

Two intervals at 2,693 meters and 1974 meters have already been tested with good oil shows encountered.

The well has now been tested at a third interval of 2,413 meters at which oil has again been detected. The quality of the oil recovered from this interval has been analysed as having an oil density of 39 degrees API (American Petroleum Institute) which indicates it is of high quality.

The Company's shallow wells have not been affected by the blockages encountered at our deep wells. Currently the four established shallow wells are testing at an aggregate rate of some 280 bopd (165 bopd net to Roxi). Additionally, test production at Well 143 has been of the order of 100 bopd (59 bopd net to Roxi).

Further announcement on the progress at our wells will be made in due course.

Comment: 

Clive Carver, Chairman said 

There is increasing evidence of the existence of good quality oil from both our deep and shallow drilling. Our challenge is to clean up our deep wells so the oil can flow unrestricted and the flow tests can be completed."

Enquiries: 

Roxi Petroleum PLC

Clive Carver, Chairman +7 727 375 0202 

WH Ireland Ltd

James Joyce / James Bavister +44 (0) 207 220 1666 

Qualified Person 

Mr. Nurlybek Ospanov, Roxi's senior geologist who is a member of the Society of Petroleum Engineers ("SPE"), has reviewed and approved the technical disclosures in this announcement.