KEA.L Regulatory News (KEA)

Kea Petroleum plc

("Kea" or the "Group")

Kea Commences Wingrove Test Operations

Kea Petroleum plc (AIM:KEA) is pleased to announce today that it has now completed mobilising all the production equipment to the Wingrove site, in New Zealand's onshore Taranaki Basin. Production-tests will now be carried out on several oil bearing Mount Messenger Sand intervals which have been encountered at Wingrove-2 in the depth range 1150-1300m.

Specialised heating equipment will be run downhole, and a hydraulic rod pumping system will be installed at the surface, to optimise flow of the waxy oil expected to be produced from the oil sands. Onsite storage tanks and offloading equipment will enable road transport of the crude to the nearby oil export port of New Plymouth.

These operations, which will take 15-20 days to complete, are being carried out using the Titan workover rig recently purchased by Kea Petroleum and Webster Drilling, a New Zealand drilling company.

After demonstrating that sustained and commercial oil flow is possible from the drill site, Kea expects to be drilling several more wells to appraise and develop the Wingrove structure, which extends over an area in excess of 10 sq km, and has a potential resource of several million barrels. The Titan rig will enable the cost-effective development of this resource, as well as being available to drill other similar targets identified by Kea on its licences.

The Chairman, Ian Gowrie-Smith said:

"Kea has identified some 20 potential Mt Messenger sands prospects on its licence areas so any reasonable result from Wingrove-2 has the potential of being replicated across the whole Wingrove structure. Part of the reason for the delays we have incurred is that we have prepared the Wingrove site for potentially as many as five further deviated holes. Even a very modest flow could prove economic at current prices for oil."

This release has been approved by non-executive director Peter Mikkelsen FGS, AAPG, who has consented to the inclusion of the technical information in this release in the form and context in which it appears.

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