New World Oil And Gas Regulatory News (NEW)

New World Oil and Gas Plc / Index: AIM / Epic: NEW / Sector: Oil & Gas

9 June 2011

New World Oil and Gas Plc ('New World' or 'the Company')

Competent Person's Report highlights prospectivity of Blue Creek Project, Belize

New World Oil and Gas Plc, a company focussed on making investments in the oil and gas sector, has received the Competent Person's Report ('CPR') from RPS Energy ('RPS') highlighting the prospectivity of the Blue Creek Project, consisting of two concessions located in the productive Petén Basin in Northwest Belize. The report, delivered in the form of a Letter of Opinion was commissioned in accordance with the Letter of Intent re the acquisition of the Project on 23 May 2011.

Key findings of the CPR:

·; The Blue Creek Project appears to be a good opportunity to access early stage exploration in a very prospective area. 

·; The Blue Creek and Blue Creek South concessions are located in Northwest Belize in the north of the relatively under-explored North Petén Basin.

·; The licenses are favourably located in an under-explored area and are considered to be highly prospective, albeit at a very early stage of maturity.

·; It seems highly likely that the Blue Creek Project is on a migration pathway out of the depocenter (source rock region) and that oil seeps, nearby oil field discoveries and geochemical work in NW Belize all point to a working hydrocarbon system.

·; The concessions lie in very close proximity to the north of the recently discovered and productive Spanish Lookout and Never Delays oil fields and due east from the Xan and Chorop oil fields of northwest Guatemala.

·; The Spanish Lookout and Never Delays fields, each of which has reported reserves in the range of 25MMbbls, are thought to be structurally similar to the leads developed on the Blue Creek Project thus far.

·; Oil production in the region is currently exported by tanker through the deep water port of Big Creek and is sold at world oil price.

·; The forward plan to acquire more seismic in a phased approach is considered appropriate to mature certain subsurface leads into prospects - multiple targets identified.

·; The forward commitments are manageable and appropriately scaled for this level of exploration maturity.

·; Key risks will be the identification of subtle traps and the timing of maturation/migration relative to trap formation. Source is low risk, migration itself is low risk, seal is low risk and reservoir presence and effectiveness in the Yalbac Y1 and Y2 is considered low risk.

The conclusions section of the CPR is reproduced in its entirety below:

New World has a right to earn up to a 100% participating interest in two frontier exploration concessions (Blue Creek and Blue Creek South - held under BCE PSA) onshore NW Belize. The license is favourably located in an under-explored area and is considered to be highly prospective, albeit at a very early stage of maturity. In our opinion, this appears to be a good opportunity to access early stage exploration in a very prospective area.

The plan to acquire more seismic in a phased approach is very appropriate and should enable certain subsurface leads to be matured into prospects. The forward commitments are manageable and appropriately scaled for this level of exploration maturity.

RPS cannot opine on what range of in-place or recoverable volumes could be discovered since insufficient data (on-block) exists to make any meaningful estimates. However, we note that the Spanish Lookout and Never Delays fields are thought to be structurally similar to the leads developed on the BCE blocks thus far and were attributed about 25 MMbbls a piece.

Key risks will be the identification of subtle traps and the timing of maturation/migration relative to trap formation. Source is low risk, migration itself is low risk, seal is low risk and reservoir presence and effectiveness in the Yalbac Y1 and Y2 is considered low risk.

RPS assigns a risk between 1 in 12 (8.33%) to 1 in 8 to (12.5%) to the current likelihood of discovering a hydrocarbon accumulation in the Blue Creek concession. This is an appropriate level of risk for a new play in an emerging area. The planned acquisition of seismic and the identification of robust structures could reduce this risk to something less than 1 in 8.

RPS will be providing updates to this report as New World complete their future acquisition and interpretation of additional 2D seismic and combine this data with pre- existing data in an effort to enhance the subsurface interpretation and further quantify and reduce risk. Ultimately, New World intends to elevate the prospectivity of one or more of the BCE block leads to drillable status upon completion of the 170 km 2D seismic program. Once seismic operations are complete and prospects have been identified, volume estimations and scoping economics will be forthcoming in the future updates to this report. The intention is to mitigate the risk as much as possible until the next logical step will be to drill wells.

New World CEO William Kelleher said, "The Company is highly encouraged by the results of the CPR that confirm our preliminary assessment of the prospectivity of the Blue Creek Project and believes, like RPS, that it is located in a working hydrocarbon system. We expect completion of the transaction to take place shortly, followed immediately by a seismic acquisition programme, in accordance with the previously stated strategy of improving our chances for an early discovery. 

"Presently, we have multiple targets on the northern license area that are significant in size and potential, and closely resemble existing producing fields to the south. Prior to actual drilling, our plan is to continue to high-grade these potential accumulations by reducing the risk, using our existing cash reserves. We look forward to providing regular updates as results of the seismic acquisition become available."

** ENDS **

Glossary:

"BCE" means Blue Creek Exploration

"km" means kilometres

"MMbbls" means Millions of Barrels (oil)

"PSA" means Production Sharing Agreement

The information contained in this announcement has been reviewed and approved by Andrew Kirchin on behalf of RPS. Mr. Kirchin has 24 years of relevant experience in the oil industry and is currently Senior VP, Geoscience and Equity, with RPS in Houston.

For further information please visit www.nwoilgas.com or contact: