Empyrean Regulatory News (EME)

31 Jul 2008 09:26



31 July 2008

Empyrean Energy PLC 

("Empyrean" or the "Company"; Ticker: (EME))

Sugarloaf Prospect, ("Sugarloaf"), Block B,  Texas USA

Empyrean Energy Plc, the oil and gas explorer and producer with assets in Germany and the USA provides the following update on operations on Block B which is part of the Sugarkane Gas and Condensate Field:

Kowalik #1H Well 

Empyrean has been advised by the Operator of the Sugarloaf AMI, Texas Crude Energy Inc ("TCEI"), that as of 06:00hrs 30/07/08 (US CST) the Kowalik #1H well had reached a depth of 6126ft  in the 8 ¾" hole section and was drilling ahead. Since the last operational update the 13 3/8" and 9 5/8" casing have both been run and cemented, with the latter at a depth of 6,020 ft.

This vertical section of the well will be drilled as a pilot hole down to approximately 11,970 ft through the chalk. This will then be logged, plugged back and the well sidetracked in the 8 ¾" hole size to the top of the chalk before 7" casing is run prior to drilling the horizontal section. The well is planned to have a 6,000ft horizontal section and is targeting the upper pay interval that has successfully produced gas and condensate in Block A (TCEI JV Block A1 and A3 wells). The Joint Venture is working towards this being the first in a continuous sequence of 4 wells.

Kennedy #1H Well

Empyrean has been advised by TCEI that following fracture stimulation operations, which took place on Thursday 3rd July and subsequent clean out operations, the well has continued to flow at 30 - 40 bbls of condensate per day with associated gas and minor volumes of fracture fluid. Over 5,000 bbls of fracture fluids have not been recovered from the most recent stimulation. The present production rates originate from 17ft of perforations in the bottom 600 ft of the horizontal section. 

This well was drilled horizontally within the deeper section (potential 'middle pay zone') of the Austin Chalk accessing a chalk horizon not previously tested within the Sugarkane Field. Whilst the gas and condensate flow rates are minor at this juncture the production represents the first sustained hydrocarbon flow from this deeper horizon indicating additional hydrocarbon recoverability above the already considerable resource estimates associated with the upper chalk horizons. The Operator proposes to place this well on long term test to allow for possible further clean up and to monitor flow performance. It is not expected that additional operations will be undertaken at Kennedy #1H until Q1 2009.

About the Sugarkane Gas and Condensate Field

The Sugarkane Field is a unique Austin Chalk Formation play that lies some 20km south of the main Texas Austin Chalk trend. In the early stages of appraisal the field is exhibiting many characteristics superior to the classic Austin Chalk fields such as the nearby Giddings and Pearsall fields that have produced over 5 Tcf of gas and 600 mmbbls oil. Notably, the Sugarkane Field is over pressured, has a higher porosity and a higher condensate to gas ratio than the classic Austin Chalk fields.

The Sugarkane Field is interpreted to cover an identified area exceeding 200,000 acres with potential gross reserves estimated at greater than 3 Tcf of gas and approximately 700 million barrels of condensate making it potentially one of the largest undeveloped gas and condensate fields within North America.

Further updates will be provided following developments.

The information contained in this announcement was completed and reviewed by the Technical Director of Empyrean Energy Plc, Mr Frank Brophy BSc (Hons) who has over 40 years experience as a petroleum geologist.

For further information 

Empyrean Energy plc 

Tel: +44(0) 207 182 1746 

Rod Venables / James Reeve

HB Corporate 

Tel: +44(0) 207 510 8600 

Jonathan Charles / Ed Portman 

Conduit PR 

Tel: +44 (0) 207 429 6611 / +44 (0) 7791 892 509