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22 Jan 2009 07:00
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FOR IMMEDIATE RELEASE
22Β JanuaryΒ 2009
Melrose Resources plc
OperationalΒ Update
Melrose Resources plcΒ (LSE: MRS) ("Melrose" or "the Company"), the oil and gas exploration, development and production company,Β todayΒ providesΒ anΒ updateΒ on its drillingΒ andΒ productionΒ operationsΒ inΒ EgyptΒ and theΒ United States.
Egypt
The West Dikirnis No.7 horizontal development well has been placed on production and is flowingΒ 3,000Β bpd of oil with 4.4Β MMcfpd of gas on a 36/64 inch choke. The well's flow rate is currently being restricted to gather well and reservoir performance data prior to potentially increasing the production rate.
The EDC-9Β rig is currently drilling theΒ secondΒ horizontal development wellΒ in theΒ West DikirnisΒ field, West Dikirnis No.10,Β whichΒ hasΒ reached a depth of 9,110 feet.Β In addition, the EDC-54Β rigΒ isΒ preparingΒ toΒ drill the first horizontal production wellΒ in the Tamad field, Tamad No.5,Β where there is the potential to addΒ in excess of 1.0 MMbbls of oilΒ reserves using horizontal wellΒ drillingΒ technology.Β
The East Dikirnis No.1 exploration well has been successfully drilled with the EDC-54Β rig to test a Qawasim formation prospect located approximatelyΒ 11Β kilometers to the east of theΒ West DikirnisΒ field. The well encounteredΒ 38 feet of gas overlying anΒ 11 feet thick oil rim with an average porosity of 23 percent. The estimated discovery volumeΒ is in the range 10Β BcfeΒ to 12Β BcfeΒ and the well has been temporarily suspended forΒ possibleΒ futureΒ sidetracking and use asΒ a production well.Β
The East Abu Khadra gas field was brought on stream via theΒ South BatraΒ facilities onΒ 23Β DecemberΒ 2008Β and is currently flowing at 7.9 MMcfpd of gas and 125 bpd of condensate.
United StatesΒ
The East Texas Nunan No.1 exploration well spudded onΒ 15 JanuaryΒ 2009Β and has reached a depth of 3,485 feet. TheΒ wellΒ is targeting a number of differentΒ payΒ zones including a shallow oil prospect with unrisked reserves of 3 MMbbls and a chance of success of 29Β percent and three deep gas prospects with combined unrisked reserves of 99 Bcf and an averagedΒ chance of success of 21 percent. TheΒ plannedΒ RamseyΒ No.1 exploration well has been deferredΒ to take advantage of an anticipated reduction in US drilling rig and services rates.
Commenting on the update,Β David Thomas, Chief Executive said:
"We are pleasedΒ withΒ the resultsΒ from East DikirnisΒ No.1Β whichΒ confirm the presence of further oil rimΒ accumulationsΒ in the Mansoura concessionΒ and we shall be evaluating development options for the discovery over future months. We also look forward toΒ progressing the Nunan No.1Β explorationΒ well in East Texas which will test a number ofΒ different reservoirΒ horizons."
For further information please contact
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Melrose Resources plc
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Robert Adair, Executive Chairman
David Thomas, Chief Executive
Diane Fraser, Finance Director
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0131 221 3360
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Buchanan Communications Limited
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Ben Willey/Ben Romney
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0207 466 5000
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or visitΒ www.melroseresources.com
Glossary:
Bcf - billion cubic feet of gasΒ
Bcfe - billion cubic feet of gas equivalentΒ
bpd - barrels of oil or condensate per day
MMbbls - million barrels of oil or condensateΒ
MMcfpd - million cubic feetΒ of gasΒ per day
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