Emerald Energy Regulatory News (EEN)

30 Jan 2006 07:02

Emerald Energy PLC30 January 2006 Emerald Energy Plc FOR RELEASE 7:00 AM 30 January 2006 Operations Update - Block 26, Syria Emerald Energy Plc ("Emerald" or the "Company") is pleased to provide thefollowing update for Block 26 (Syria) in which Emerald holds a 50% workinginterest through its 100% owned subsidiary SNG Overseas Ltd. A detailed review of drilling records and wireline logs of six wells previouslydrilled to test Palaeozoic reservoirs within Block 26 has concluded that threeof the wells encountered potential commercial hydrocarbon accumulations. Thelargest of these potential accumulations, the Tigris structure, is locatedbeneath the Souedieh Field, the largest oil field in Syria. The ProductionSharing Contract for Block 26 grants oil and gas rights to all reservoirsbeneath the existing fields within the block, such as the Palaeozoic aged Tigrisstructure, and oil and gas rights to all depths in areas outside of the existingproducing fields. Ryder Scott Company LP ("Ryder Scott") has prepared an independent study of therecoverable gross reserves for the Tigris structure using the reservedefinitions approved by the Society of Petroleum Engineers and the WorldPetroleum Congress. The data used for the study includes wireline logs from awell drilled to the Palaeozoic in the Tigris structure in 1994, and an extensive3D seismic survey available over the Souedieh Field. Reserve and resourcefigures are stated in billions of cubic feet of natural gas (bcf), millions ofbarrels of oil (mmbbl) and millions of barrels of oil equivalent (mmboe) wheresix thousand cubic feet of natural gas is equivalent to one barrel of oil. The Tigris structure is potentially large but with only one well bore on thestructure. Based on data currently available, the Ryder Scott report concludesthat there are nine potentially productive zones contained within Palaeozoic agereservoirs penetrated by the existing well bore. As the available data isinsufficient to determine the expected hydrocarbon fluid contained within thestructure, Ryder Scott developed two cases for this evaluation: a gas case andan oil case. If Tigris is a natural gas accumulation, Ryder Scott has classified 442 bcf asProbable Reserves, a further 442 bcf as Possible Reserves, and a further 3447bcf as a Prospective Resource. In summary, total hydrocarbon potential forProbable and Possible Reserves and Prospective Resource in this case is 4330bcf, equivalent to 722 mmboe. If Tigris is an oil accumulation, Ryder Scott has classified 104 mmbbl of oiland 64 bcf of gas as Possible Reserves and a further 408 mmbbl of oil and 245bcf of gas as Prospective Resource. In summary, total hydrocarbon potential forPossible Reserve and Prospective Resource in this case is 512 mmbbl and 308 bcf,equivalent to 563 mmboe. Emerald's 50% participating interest in the Tigris structure and it potentialreserves, is subject to the fiscal terms of the Production Sharing Contract. A Letter of Intent has been signed with a drilling contractor to drill a well onthe Tigris structure and plans are underway to commence drilling in August 2006. Alastair Beardsall, Emerald's Chairman, said: "The results of this evaluation are very encouraging. The reserves identified in the independent reserves report prepared by Ryder Scott add significantly to our confidence in a positive outcome for the exploration well to be drilled on Tigris in August 2006. Confirmation of these reserves by the Tigris well will greatly enhance our reserves base." Enquiries: Helen Manning 020 7925 2440 This information is provided by RNS The company news service from the London Stock Exchange