CERP.L Regulatory News (CERP)

For Immediate Release

11 July 2014

Leni Gas & Oil PLC

("LGO" or the "Company")

Goudron Drilling and Infrastructure Update

LGO today announces that the fourth of its planned Goudron development wells, GY-667, was successfully spudded yesterday at 1530 hrs T&T time and is now drilling ahead in the Goudron Sandstones.

The well is being drilled as a deviated hole from the same well pad as used for the recently drilled wells GY-665 and GY-666. 

Well GY-667 has a planned total depth of 3,600 feet true-vertical depth ("TVD") (equivalent to 3,840 feet measured depth) to a bottom-hole location that is approximately 590 feet south east of the surface location. The primary target of this well is the Gros Morne sandstones, the top of which are anticipated at a depth of approximately 2,180 feet TVD. The well will also investigate the reservoir potential of the Lower Cruse at this location.

Further announcements will be made once the main reservoir targets have been drilled.

Separately, final approvals have now been received for the construction and installation of a new 2,000-barrel sales tank and construction contracts have been awarded. The new tank will be installed at the Goudron Field's oil sales point at Tank Battery Station 134 and will be adjacent to the two existing sales tanks increasing total daily export capacity equivalent to approximately 2,750 barrels of oil per day. It is anticipated that the new tank will be commissioned to coincide with the completion of the four wells being drilled on the current well pad; of which GY-667 is the third.

Negotiations for a second drilling rig are actively being progressed with a variety of different options emerging. It is planned to retain Well Services Rig 20 for at least a further six wells and no decision has yet been taken on the choice of the second rig.

Neil Ritson, LGO Chief Executive, commented:

"The 30 well drilling campaign continues to advance extremely well and we are making considerable progress in learning about the geology and drilling characteristics of the field. That knowledge is being used to optimize the development and we anticipate both cost and timing efficiencies will continue to be made through the remainder of the program. The addition of an optimally specified second rig remains an objective for the third quarter. "

Results from the drilling program to date are given in the table in Appendix below.

Competent Person's Statement:

The information contained in this announcement has been reviewed and approved by Neil Ritson, Chief Executive Officer and Director for Leni Gas & Oil Plc, who has over 35 years of relevant experience in the oil industry. Mr. Ritson is a member of the Society of Petroleum Engineers (SPE), an Active Member of the American Association of Petroleum Geologists (AAPG) and is a Fellow of the Geological Society of London.

Enquiries:

Leni Gas & Oil plc

Beaumont Cornish Limited

Old Park Lane Capital Plc

Pelham Bell Pottinger

Appendix:

All depths are quoted as measured depth in feet below Kelly bushing

np = not penetrated

Glossary:

Pay: A reservoir or portion of a reservoir formation that contains economically producible hydrocarbons. The overall interval in which pay sections occur is the gross pay; the portion of the gross pay that meets specific criteria such as minimum porosity, permeability and hydrocarbon saturation are termed net pay.

MD: Measured Depth

TD: Total Depth