MXP.L Regulatory News (MXP)

20 Jul 2006 16:31

Max Petroleum PLC20 July 2006 MAX PETROLEUM PLC (AIM:MXP) Operational Update Max Petroleum PLC ("Max Petroleum" or the "Company") is pleased to announce thatit will accelerate its exploration programmes in respect of highly prospectiveintermediate-depth structures identified in its Blocks A&E acreage in WesternKazakhstan. The recent seismic campaigns carried out by Max Petroleum on its A&E Blocks in2005 and 2006 have been extensive, with 1,480 kilometres (km) of new 2D seismiccompleted and 380 km of 3D seismic currently 60% complete. The seismic, coupledwith large volumes of historical data, has allowed for the identification ofseveral attractive leads at intermediate depths, both on the flanks of saltdomes and in the areas between them. This is particularly interesting and prospective because the vast majority ofSoviet-era exploration in the Company's A&E blocks was directed towards shallowsections within specific small areas in the blocks. In addition, four deep wellswere drilled in attempts to test the pre-salt section. However, no explorationwas targeted to intermediate depths of between 1,000 and 3,000 metres (m). As an example of the obvious prospectivity of the intermediate plays, theCompany has identified oil in two zones in the Soviet era deep Zharbas P-2 well,drilled in 1982, which was never tested. The well logs show two very interestingsections, one 18 m thick oil-bearing sand in the Jurassic at 1116 m and another12 m oil-bearing sand in the Permo-Triassic at 1890 m. Max Petroleum isinvestigating the feasibility of using the drilling rig contracted for thepurpose of drilling shallow wells in Block E to drill the Jurassic section inthis area in the near future. The identification of this prospect is an obvious starting point for anaggressive intermediate-depth exploration programme. Other leads have beenidentified in the intermediate section in the area surrounding the P-2 well andin several other areas in the A&E blocks. Each of the intermediate structures isestimated to have recoverable reserves from around 50 million to in excess of150 million barrels based on initial analysis by Max Petroleum engineers. Theestimates are subject to verification by Max Petroleum's competent person,McDaniel & Associates, and a further update will be provided in due course. Thismakes them economically very attractive targets, as the pressures expected atthese depths would mean good flow rates and un-assisted flow. In addition, theoil would be expected to be relatively light and free of sulphur, and thusattractive for production, processing and transport purposes. Max Petroleum is in the process of evaluating several of these intermediatestructures and will bring in additional geological/geophysical and drillingpersonnel within the short term to fast track this effort. This acceleratedintermediate exploration programme will be in addition to the alreadyestablished programmes for the shallow and deep sections of the Company's blocksand will run in parallel with these programmes. It is expected thatintermediate drilling can thus be accelerated from the fourth quarter 2007 toearly in the second quarter 2007 at the latest, with no impact on the timing ofthe Company's other exploration programmes. 20 July 2006 Enquiries: Max Petroleum PLC Steve Kappelle T: +44 (0)20 7355 9590 Chief Executive Officer Pelham Public Relations Charles Vivian T: +44 (0)20 7743 6672 E : Charles.vivian@pelhampr.com Alisdair Haythornthwaite T : +44 (0) 20 7743 6676 E: Alisdair.haythornthwaite@pelhampr.com WH Ireland Ltd Paul Dudley T : +44 (0) 20 7220 1666 E : paul.dudley@wh-ireland.co.uk Henrik Busk, Petroleum Engineering and Geology Manager of Max Petroleum, aPetroleum Geologist, is the qualified person that has reviewed and approved thetechnical information contained in this announcement. This information is provided by RNS The company news service from the London Stock Exchange