Emerald Energy Regulatory News (EEN)

16 Jan 2006 07:01

Emerald Energy PLC16 January 2006 Emerald Energy Plc FOR RELEASE 7:00 AM 16 January 2006 Operations Update - Block 26, Syria Emerald Energy Plc ("Emerald" or the "Company") is pleased to provide thefollowing update based on information released by Gulfsands Petroleum PLC("Gulfsands"), the operator, for Block 26 (Syria) in which Emerald and Gulfsandseach hold a 50% working interest: Letters of Intent for drilling rigs Gulfsands has executed two Letters of Intent ("LOI") with MB Drilling OverseasLimited for the provision of drilling services. The LOI for MB Rig 21, capableof drilling the shallow Cretaceous wells, is for one well with a second welloption. The LOI for MB Rig 3, a larger capacity rig for deeper drilling to thePaleozoic, will be part of a rig sharing agreement with another companyoperating in Syria. The rig is planned to be contracted for a one year period,with an option to extend for two additional one year periods. Negotiations ondefinitive rig contracts are now underway and Gulfsands expect these to besigned shortly. Two Prospects Selected for Exploration Drilling The first prospect to be drilled is Souedieh North and is located in thenortheast region of Block 26. A vertical well will be drilled to an approximatetotal depth of 7,216 feet with the primary objective being Cretaceous agedreservoirs similar to those producing in the adjacent Souedieh and Karachok oilfields. The expected spud date for this well is early May 2006. The second prospect, Tigris, is also located in the northeast region of theBlock. A vertical well will be drilled to an approximate total depth of 14,760feet with the primary objectives being a series of Carboniferous and Devoniansandstone reservoirs. The Tigris structure is directly underlying the Souediehoil field (the largest known oil field in Syria) where oil is produced from theshallower Cretaceous reservoirs. Re-evaluation of wireline logs of an existingwell on the structure drilled some years ago has identified potentialhydrocarbon bearing zones within the objective reservoirs. The Tigrisexploration well is designed to evaluate these reservoirs and appraise thispotential hydrocarbon accumulation. The well is expected to spud in late August2006 after the rig completes an existing long-term drilling contract in Syriawith another company. Alastair Beardsall, Emerald's Chairman, said: "Emerald is committed to the exploration of Block 26 and we are pleased to seethe progress the operator is making in the drilling program. We believe thedrilling of these first two prospects, particularly the Tigris structure, hasthe potential to discover significant hydrocarbons and Emerald's share willgreatly enhance our reserve base." Enquiries: Helen Manning 020 7925 2440 This information is provided by RNS The company news service from the London Stock Exchange