Cloudbreak Regulatory News (CDL)

26 Oct 2006 13:07

Cardinal Resources plc26 October 2006 CARDINAL RESOURCES PLC Announces Well Test Results BC No. 3A Well at 675 BOEPD LONDON - Thursday, 26th October 2006 Cardinal Resources plc (AIM:CDL), ("Cardinal" or "Company") an independent oiland gas production and exploration company operating in Ukraine, today announcesthat it has completed the first stage of flow testing at Well No.3A on theBilousivsko-Chornukhinska (BC) Licence ("BC No. 3A Well"). The well flow tested at 4.05 million cubic feet of gas per day ("MMcfg/d") or675 barrels of oil equivalent per day (BOEPD) from perforations between 3098 to3103 meters in the V-20 reservoir and was flaired. The average wellhead flowingpressure of 88.4 atmospheres (1,300 psi) was obtained through a 9 mm (24/64 in.)choke. The testing follows the deepening of the Well which commenced in June 2006,where two reservoirs ("V-18" and "V-20") were identified as being potentiallycapable of commercial production. While log analysis indicates the V-18 to behydrocarbon bearing; no testing was conducted on the V-18 reservoir. TheCompany intends to produce gas from the V-20 first and leave any testing andcompleting V-18 until a later date. The BC No. 3A Well is now shut-in while the test data is being analysed. Thewell will be completed at the V-20 interval and tied into the BC gas gatheringand separation facility, with completion expected in the second quarter of 2007. The BC No. 3A Well was drilled using a Ukrainian "hybridized" drilling rig,developed by Cardinal, which reduced the drilling time from a forecasted eightmonths to 76 days. Commenting on today's news, Robert J. Bensh, Chairman and CEO of Cardinal said,"I am encouraged with the improvement in drilling time and the potential impactthat has on our current drilling program. The completion of this well and theinstallation of the gas facility are important to keep Cardinal on track to meetour goal of 3,000 BOEPD of incremental production by the end of 2007. Background The original BC No.3 Well was drilled in 1957 by a Ukrainian state entity. There-drill of the new well, BC No. 3A, commenced in June 2006. In early Augustthe Visean-17 (V-17) formation at 3,000 metres was reached. Cardinal'sevaluation showed non-commercial indications of gas in the V-17. The well wasthen deepened to 3,300 metres and the evaluation of this lower interval showedthe presence of three zones in the Visean section (V-18, V-20 and V-21) andbased upon wireline log analysis, these three zones appeared to be hydrocarbon-bearing; with two of the zones potentially capable of commercial production. Cliff West, Executive Vice President and Chief Operating Officer of Cardinal(Member of the American Association of Petroleum Geologists - CertifiedPetroleum Geologist # 1563) is the qualified person that has reviewed andapproved the technical information within this press announcement. Glossary of Terms MMcfg/d Million cubic feet of gas per day BOEPD Barrels of oil equivalent per day ### For further information please contact: Cardinal Resources Parkgreen CommunicationsCharles Green / Franziska Stahlknecht Justine Howarth /Victoria Thomas +44 (0) 20 7936 5250 +44 (0) 20 7493 3713 investor.relations@cardinal-uk.com victoria.thomas@parkgreenmedia.com Notes to Editor Cardinal Resources plc Cardinal Resources plc is an independent oil and gas company engaged in theacquisition, development, production and exploration of oil and natural gasproperties in Ukraine. Cardinal is an experienced operator in the countryfocused on expanding its existing operations through the farm-in or acquisitionof additional upstream oil and gas assets that can be further developed throughthe application of modern technology and expertise. Cardinal's main assets are: Rudivsko-Chernovozavodske (RC) Field Rudivsko-Chernovozavodske is a large under-developed gas field (1.54 TCF original gas in place), located in the Dnieper-Donets basin, 200km east of Kiev in the Poltava Oblast. Cardinal has a JointActivity Agreement (JAA) with a subsidiary of Ukrnafta for production andfurther development in which Cardinal holds a 14.9% net profit interest. Bytkiv-Babchenske (Bytkiv) Field Bytkiv-Babchenske is an oil field, located inthe Carpathian fold belt, 45km south-west of Ivano-Frankivsk in the NadvirnaOblast. Cardinal has a 45% interest through UkrCarpatOil, a Joint Venture (JV)with Ukrnafta, to operate and develop the field. Plus the following assets which were acquired as part of the Rudis DrillingCompany transaction in 2005: Bilousivsko-Chornukhinska (BC) Licence Bilousivsko-Chornukhinska is a producinggas-condensate licence in the Dnieper-Donets basin, 100% owned and operated byCardinal. North Yablunivska (NY) Licence North Yablunivska is a producing gas-condensatelicence in the Dnieper-Donets basin, 100% owned by Cardinal and operated underthe JAA. For four wells on the licence covered by JAA 429, Cardinal's interestis only 50% in each such well. Dubrivska (DB) Licence Cardinal has drilled an exploration well as part of theJAA with Ukrgazvydobuvannya. Ukrgazvydobuvannya JAA #429 Cardinal has a 50% percent interest in a JAA withUkrgazvydobuvannya which covers certain wells on the NY licence area and onewell in the Bilskie field. This release may contain certain forward-looking statements. These statementsrelate to future events or future performance and reflect management'sexpectations regarding Cardinal's growth, results of operations, performance andbusiness prospects and opportunities. Such forward-looking statements reflectmanagement's current beliefs, are based on information currently available tomanagement and are based on reasonable assumptions as of this date. Noassurance, however, can be given that the expectations will be achieved. Anumber of factors could cause actual results to differ materially from theprojections, anticipated results or other expectations expressed in thisrelease. While Cardinal makes these forward-looking statements in good faith,neither Cardinal, nor its directors and management, can guarantee that theanticipated future results will be achieved. This information is provided by RNS The company news service from the London Stock Exchange