EDR.L Regulatory News (EDR)

10 Nov 2005 07:00

Egdon Resources PLC10 November 2005 10 November 2005 For immediate release EGDON RESOURCES PLC Commencement of UK Onshore Drilling Programme Egdon Resources Plc ("Egdon" or "the Company") is pleased to advise that theBDF28 drilling rig is scheduled to mobilise to the Waddock Cross-3 well site inDorset on Monday 14 November with drilling operations expected to commence on oraround 16 November. The rig is owned and operated by British Drilling andFreezing Limited ("BDF"). Waddock Cross-3 will be the first of a four or five well operated drillingprogramme in the onshore UK. Drilling will target an elevated part of theWaddock Cross oil accumulation identified by the recent 3D seismic survey. A600 m horizontal section will be drilled and completed through the reservoir.The well will be 1525m in length and take an estimated 25 days to drill.Following drilling and completion operations the rig will be moved off site andthe well will be put on an extended well test ('EWT') using a pump-jack ('nodding donkey'). In addition the Company holds an option with BDF to drill afurther horizontal appraisal well at Waddock Cross at the end of the currentprogramme. The second well in the drilling programme, Kirkleatham-4, is due to be drilledimmediately following the Waddock Cross-3 well during December 2005. TheKirkleatham prospect is located beneath and to the west of the town of Redcar inCleveland. The structure was originally tested by two wells in the mid 1940s,with testing producing sub-commercial gas-flows in both wells from Permian ageZechstein carbonates. Seismic data shows the potential to apply modern drillingand completion techniques up-dip of both wells. The Kirkleatham-4 explorationwell will test for the presence of an effective gas reservoir in this up-diparea of the structure. Kirkleatham-4 will be drilled as a vertical well to aprognosed depth of 900 m and is anticipated to take 15 days to drill. The third well in the programme will be the Westerdale-1 exploration well in theNorth Yorkshire Moors. Westerdale-1 is designed to test an accumulation 50.5 mupdip and 3.7 km to the north of the Ralph Cross-1 gas discovery made by HomeOil Limited in 1966. Ralph Cross-1 tested gas at flow rates of up to 6 MMcfgdfrom a 20.5 m gas column in fractured Zechstein carbonates. The PEDL068 groupbelieves that better positioning, completion and management of a well within theprospect could produce a significant and sustainable commercial gas flow.Additional reservoir objectives are present in the Westerdale-1 well both withinthe Zechstein and in the underlying Carboniferous sequences. Westerdale-1 willbe directionally drilled to a total depth of around 1250 m and will take around21 days to drill. The Portland-1 borehole, for which planning consent has now been received, willbe drilled as the fourth well in the programme to a depth of around 2500 m.Drilling, coring and testing operations are expected to take around 50 days.Data from the well will enable the determination of the thickness andsuitability of the salt interval to create caverns at the proposed Portland GasStorage Project. Commenting on the forthcoming drilling activity, Egdon's Joint ManagingDirector, Mark Abbott, said, "This, our first multi-well drilling programme,represents the culmination of many years of exploration work by the Company.The 'back-to-back' nature of the programme has resulted in significant overallcost savings on materials, equipment and services. We look forward to an activeand exciting period with the hope of continuing the Company's record ofdrill-bit success". For further information please contact: Egdon Resources Plc 01256 702292Mark Abbott, Joint Managing DirectorAndrew Hindle, Joint Managing Director Buchanan Communications 020 7466 5000Eric BurnsBen Willey Notes to the Editors: The wells within the outlined Egdon operated drilling programme are locatedwithin the PL090 licence (Waddock Cross-3, Waddock Cross-4) in the Wessex Basinwhere the Company holds a 45% working interest and the PEDL068 licence(Kirkleatham-4, Westerdale-1) in the Cleveland Basin where the Company holds a20% working interest but is carried for 10% of the first well, Kirkleatham-4,and also holds an option to increase its interest to 25%. The Portland-1 gasstorage confirmation well will be drilled by Egdon from a site leased by itswholly owned subsidiary, Portland Gas Limited. 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. In December 2004,Egdon's shares commenced trading on AIM, having been previously traded on Ofexsince July 2000. The Company is developing two major business areas; an oil andgas exploration and production business which has a portfolio of twentyexploration licences containing identified oil and gas prospects ranging fromdiscoveries under appraisal through to higher risk but higher reward "wild cat"exploration prospects; and a gas storage business initially focused on thedevelopment of a salt cavern gas storage facility on the Isle of Portland,Dorset. This information is provided by RNS The company news service from the London Stock Exchange