Management Resource Solutions Regulatory News (MRS)

9 Mar 2005 12:09

Melrose Resources PLC09 March 2005 FOR IMMEDIATE RELEASE 9th March 2005 MELROSE RESOURCES PLC Acquisition of new Concession Area in the Gulf of Lion, France Melrose Resources plc ("Melrose") announces the acquisition from TGS-Nopec ("TGSN") of the Rhone Maritime Exploration Permit which is located in the Gulf ofLion off the southern Mediterranean coast of France. Formal approval for thetransfer of the interest in the Permit was confirmed by the French Ministere DeL'Economie, Des Finance Et De L'Industrie on 8th March 2005. The Permit covers25,000km2 and the first three-year exploration period runs until November 2005.Two further exploration periods of up to five years each are available. Consideration for the transfer in ownership will be the full recovery of pastcosts by TGSN which will also retain a net profits interest in the permit. TGSNwill continue to work with Melrose on the further technical evaluation of thepermit area. The area is an under-explored oil and gas province: two wells were drilled inthe shallow-water shelf in the northern part of the concession in the 1970'swhen offshore drilling technology was limited to relatively shallow water. Theprospective area of the current concession lies in average water depths ofnearly 2,000m but drilling operations in such water depths are now routine. 4,305km of 2D seismic data was acquired by TGSN in 2001 and initial evaluationof the seismic has demonstrated significant potential. Two major play fairways,divided by a thick salt sequence, have been recognised across the basin. Thethick clastic sediments in both of these play fairways have been deposited viathe Rhone Delta system into the deepwater slope system setting of the Liguro/Provencal Basin. In the shallower post-salt play the Pliocene interval hasundergone significant structuring over time caused by deformation and flow ofthe salt layer beneath. This folding and faulting has resulted in large closuresthat could accommodate sizeable accumulations of hydrocarbons. Within thesection abundant AVO anomalies suggest the presence of hydrocarbons, The second of the two play fairways is the deeper pre-salt Miocene sequencewhich directly underlies the salt and has distinct seismic reflectioncharacteristics that could again indicate the presence of hydrocarbons. Thissequence is inferred to comprise turbiditic deposits with reservoir, seal andsource rocks all present. The combination of large structures and hydrocarbonindicators in both plays is very promising. Commenting on this, Robert Adair, Chairman, said: "We are very pleased to have been able to acquire this very prospectiveexploration acreage, located in our geographical focus area. We look forward toworking with TGSN on the technical evaluation of the permit. We believe that theRhone Maritime Permit has great potential and further 2-D and 3-D seismic datawill be acquired by Melrose in the expectation of confirming this potential. Thestructures already identified in the post-salt play are capable of trapping gasvolumes in excess of 10 Tcf. The deeper pre-salt play is believed to be more oilprone and again very large structures have been identified on the seismic. Indue course our goal will be to farm down from the current 100% ownership priorto committing to an exploration well." For further information please contact: Melrose Resources plcRobert Adair , Chairman 0184 553 7037David Curry, Chief Executive 0131 221 3360Munro Sutherland, Finance Director 0131 221 3360Chris Thomas, Corporate Development Director 0207 462 1603 Buchanan CommunicationsTim Thompson 0207 466 5000Ben Willey or visit www.melroseresources.com This information is provided by RNS The company news service from the London Stock Exchange