Leed Resources Regulatory News (LDP)

7 Feb 2008 14:28

Leed Petroleum PLC07 February 2008 Leed Petroleum PLC ("Leed" or the "Company") Drilling Update Leed Petroleum PLC, the oil and gas exploration and production company focusedon the Gulf of Mexico, today announces the successful drilling of the primarytarget zone on the Eugene Island A-6 well. Initial results of the well exceedthe Company's expectations and provide the potential for reserves upgrades. Eugene Island A-6 development well was spudded on 16 September 2007 and theCompany has successfully sidetracked and run casing in the wellbore to a depthof 15,335 feet, which is 120 feet below the primary target sand. Logging ofthis section of the wellbore has been performed and the log results confirm thatthe primary target sand has 56 feet of net true vertical thickness pay. Analysis of the logs indicates that the objective sand is thicker and of higherquality than the Company had expected prior to drilling. At the time ofadmission to AIM, the competent person, an independent reservoir engineeringfirm, credited the primary zone with 2P* reserves of 824 thousand barrels of oiland 4.8 billion cubic feet of gas. Based on the Company's evaluation of thelogs, the Company's internal post-drill reserve estimate for the primary zoneexceeds this by one third. Moreover, the Company believes that after the wellhas produced for a short time the Company's independent reserve auditor willmove a substantial portion of the pre-drill estimated 2P* reserves into the 1P*category. The Company is currently preparing to drill ahead to penetrate additionalexploratory zones. On completion of the additional exploratory drilling, Leedintends to carry out production tests to determine flow rates for the EugeneIsland A-6 development well. Refurbishment of existing facilities to accommodateproduction from the A-6 well has already commenced, and the Company expects tobegin producing hydrocarbons from this well very shortly after the well iscompleted. Further announcements will be made at the appropriate time. The Eugene Island Blocks are located 50 miles offshore, south of Morgan City,Louisiana, in the Gulf of Mexico, in approximately 80 feet of water. Leed'smanagement team has built an inventory of development projects and explorationtargets across the Eugene Island Block 183/184 field. Howard Wilson, President and Chief Executive of Leed, commented: "Although this well has taken quite a bit longer to drill than we had plannedoriginally, we are delighted to have casing across the primary objective, thequality of which significantly exceeds our expectations. We eagerly awaittesting the highly prospective deeper objectives in this well and commencementof production from the wellbore in the near future." 7 February 2007 For further information: Leed Petroleum PLCHoward Wilson, President and Chief Executive +1 337 314 0700James Slatten, Chief Operating Officer +1 337 314 0700 Matrix Corporate Capital LLPAlastair Stratton +44 20 7925 3300Tim Graham +44 20 7925 7852 Pelham Public RelationsAlisdair Haythornthwaite +44 20 7743 6676Evgeniy Chuikov +44 20 3008 5506 NOTES TO EDITORS Review by a qualified person The information contained in this announcement has been reviewed and approved byChris Thompson, Manager of Business Development at the Company, BSC GradDip, whois a reservoir engineer (SPE) with over 15 years experience within the sector. Reserve Estimates The Company's reserve estimate stated in the announcement is made in accordancewith guidelines published by the Society of Petroleum Engineers and is based onmanagement's interpretation of the available data. The estimate has not beenaudited by an independent reserve auditor. Reserve Definitions* 1P - Proved Reserves2P - Proved and Probable Reserves3P - Proved, Probable and Possible Reserves Proved Reserves are the estimated volumes of crude oil, condensate, natural gasand natural gas liquids which, based upon geologic and engineering data, arereasonably certain to be commercially recovered from known reservoirs underexisting economic and political/regulatory conditions and using conventional orexisting equipment and operating methods. When probabilistic methods are used,reasonable certainty means there is a 90% probability that the quantitiesproduced will exceed the estimate of proved reserves. Proved reserves arelimited to those quantities of hydrocarbons which have been evaluated either byactual production or by analytical tools and methods which demonstratereasonable certainty of future recovery. Probable Reserves are those reserves which geologic and engineering datademonstrate with a degree of certainty sufficient to indicate they are morelikely to be recovered than not. When probabilistic methods are used, there isat least a 50% probability that the quantities actually produced will exceed thesum of proved and probable reserves. Possible Reserves are those reserves which geologic and engineering datademonstrate are less certain than probable reserves and can be estimated with alow degree of certainty, insufficient to indicate whether they are more likelyto be recovered than not. When probabilistic methods are used, there should beat least a 10% probability that the quantities actually produced will exceed thesum of proved, probable and possible reserves. Operations Leed's operations are predominantly concentrated in the Gulf of Mexico. TheCompany operates through two subsidiaries3/4LP Inc. and LP LLC. Through LP LLC,the Group holds operating interests in Eugene Island block 183 and the southernhalf of Eugene Island block 184, Main Pass block 115, Grand Isle blocks 95 and100, the South Marsh Island blocks 5 and 6, a portion of the Sorrento Field andthe Ship Shoal block 205 as well as non-operating interests in the East Cameronblocks 317 and 318, Main Pass blocks 64 and 65 and Eugene Island block 172 andthe northern half of Eugene Island block 184. The Eugene Island assets (otherthan block 172), the East Cameron assets and the Main Pass blocks 64 and 65 areproducing fields located off the coast of the state of Louisiana in the Gulf ofMexico. This information is provided by RNS The company news service from the London Stock Exchange