EDR.L Regulatory News (EDR)

15 Mar 2006 07:00

Egdon Resources PLC15 March 2006 For immediate release 15 March 2006 EGDON RESOURCES PLC Operations Update: Kirkleatham-4 Confirmed as Gas Discovery Egdon Resources Plc ("Egdon" or "the Company"), the UK based independent oil andgas exploration and production company, is pleased to provide an update on itsUK operations and announce that testing operations have confirmed the presenceof gas at the Kirkleatham-4 well. At Kirkleatham-4 in Cleveland Basin licence PEDL068, testing of 6m perforatedinterval at the top of the Cadeby Formation commenced on 6 March with an initialflow rate of 2.8 million standard cubic feet of gas per day ("mmscfgd"). Therate was increased in steps during the five day test to a final rate of 5mmscfgd at a flowing well head pressure of approximately 1000 pounds per squareinch gauge pressure ("psig") through a 18/64" choke. During the test, flaringwas restricted to the period 07.00 to 19.00 hrs. The well was shut-in for a longterm build-up on 10 March. Initial analysis indicates that the gas quality isgood with less than 3 mol% inert content and 93 mol% Methane. The well has been completed for potential future production and will besuspended once the down-hole pressure gauges are recovered from the well laterthis week. The future programme for Kirkleatham will be decided followingrecovery of the down-hole gauges and full analysis of the test results. Planningis progressing for potential seismic acquisition over the Kirkleathamaccumulation. Test equipment and personnel are currently being moved from Kirkleatham-4 to theWesterdale-1 well-site, also in PEDL068, to test indications of gas encounteredin two intervals during recent drilling operations. Drilling operations at the Portland-1 well commenced on 6 March. The BDF28 rigwas drilling ahead at a depth of 810 metres at 15.00 hrs on 14 March. Portland-1is being operated by Egdon on behalf of its wholly owned subsidiary, PortlandGas Limited. Data from the well will enable the determination of the thicknessand suitability of the salt interval to create caverns at the proposed PortlandGas Storage Project. Portland-1 has a prognosed total depth of around 2500 m.Drilling, coring and testing operations are expected to take around 50 days. In Weald Basin licence PEDL070, operated by Star Energy Plc, the Avington-3appraisal well has reached TD and the well has been logged and a liner set. Awell test programme will now be undertaken using the operator's work-over rig. For further information please contact: Egdon Resources PlcMark Abbott, Joint Managing Director 01256 702292Andrew Hindle, Joint Managing Director Buchanan CommunicationsEric Burns 01943 883 990Ben Willey 020 7466 5000 Notes to the Editors In the PEDL068 licence in the Cleveland Basin the Company holds a 20% workinginterest and holds an option to increase its interest to 25%. The Portland-1 gasstorage confirmation well is being drilled by Egdon from a site leased by itswholly owned subsidiary, Portland Gas Limited. The Company holds a 20% workinginterest in the PEDL070 licence in the Weald Basin Company Background Egdon is an established, UK-based energy company primarily focused on thehydrocarbon-producing basins of the onshore UK. Egdon also has explorationinterests in the offshore UK and France. Egdon was formed in 1997 by Dr Andrew Hindle and Mark Abbott. The Company'sshares are traded on AIM under code EDR. The Company is developing two major business areas: An oil and gas exploration and production business which has a portfolio oftwenty exploration licences containing identified oil and gas prospects rangingfrom discoveries under appraisal through to higher risk but higher reward "wildcat" exploration prospects. A gas storage business initially focused on the prospective development of amajor salt cavern gas storage facility beneath the Isle of Portland, Dorset. This information is provided by RNS The company news service from the London Stock Exchange