PCI.L Regulatory News (PCI)

14 May 2008 07:00



Petroceltic International plc

Operational Update, North Africa

Highlights

Algeria 

Isarene Permit successfully enters the second exploration phase for a two year period

State of the art 3D seismic survey designed to locate areas of optimum reservoir quality

To date 510 sq km of 3D acquired over large gas/condensate prospect

Initial results encouraging

Drilling tenders issued with drilling due to commence Q1 2009

Tunisia

Ksar Hadada permit renewed for 3 year period

New seismic evaluation indicates a number of exploration prospects on the licence.

Algeria - Isarene Production Sharing Contract (75 per cent interest / Operator) 

Petroceltic International plc ("Petroceltic") is pleased to announce that approval has been granted for the Isarene permit in Algeria to enter the second exploration period. The second period officially commenced on April 26th 2008 and is in force for two years until April 25th 2010. 

Petroceltic has retained 70 per cent of the original Isarene Permit area (7,520 sq. km) into the second exploration period, in line with the provisions of the Production Sharing Contract. The retained area contains all of the prospects previously identified by Petroceltic on the licence. 

Currently Petroceltic is acquiring a state of the art 3D seismic programme over a large gas/condensate prospect "the Ain Tsilla Ridge" in the north eastern part of the permit, which according to Petroceltic's estimates could contain gas resources of greater than two trillion cubic feet.  Two wells have already been drilled on this prospect by previous operators, both of which tested gas and some condensate. Petroceltic's new seismic is a "Wide Azimuth 3D" and has been designed to locate areas of optimum reservoir quality in the target Ordovician sandstones. To date approximately 510 of a planned 890 square kilometre programme have been acquired. Initial results from the new seismic are encouraging. 

Petroceltic is also reprocessing existing data throughout the block and this together with the new 3D seismic will provide the platform for a planned extensive drilling campaign during the second exploration period. Tender documents have now been issued to drilling contractors. Petroceltic intends to commence drilling on this licence in Q1 2009, subject to rig availability.

Petroceltic has a 75 per cent interest in the Isarene permit in association with Sonatrach, the Algerian state Oil and Gas Company, which holds the remaining 25 per cent.

Tunisia (57 per cent interest / Operator)

Petroceltic as operator of the Ksar Hadada permit has been informed by the Tunisian government that the application to enter the first renewal period has been approved. The first renewal period of the permit begins on 20th April 2008 and lasts for three years. In line with the Production Sharing Contract, Petroceltic and its' co-venturer Independent Resources have retained 80% of the original Ksar Hadada permit (5,600 sq. km) into the first renewal period.

New interpretation of seismic and well data on the permit has yielded positive results with the validation of a number of Ordovician and Silurian prospects in the southern part of the block. Drilling on this licence has been deferred until first half 2009, due to rig availability issues, and to incorporate exploration drilling results on adjacent permits.

Petroceltic has a 57 per cent interest in and is operator of the Ksar Hadada permit. Other partners are Independent Resources (Ksar Hadada) Ltd, (40 per cent)  GA.I.A. srl 1.5 per cent, Derwent Resources (Ksar Hadada) Ltd 1.5 per cent.

Commenting on the above John Craven CEO of Petroceltic said:

"These agreements secure these permits for Petroceltic and its partners in both Algeria and Tunisia for the coming years. We are now moving to deliver the underlying value from the high potential prospects on the permits during this period. The new 3D in Algeria looks very promising, and we are focusing on locating areas of optimum reservoir quality for drilling. Based on this, we look forward to an exciting programme of drilling over the next twelve months."

Press Enquiries to:

John Craven, Chief Executive, Petroceltic International plc, is the qualified person who has reviewed and approved the technical information contained in this announcement. John holds a B.Sc. in Geology from The Queens University of Belfast, and an M.Sc in Petroleum Geology from Imperial College London, and has over 20 years experience in oil & gas exploration and production. 

Notes to Editors:

Petroceltic International plc is a leading Upstream Oil and Gas Exploration and Production Company, focused on the Mediterranean and North African area, and listed on the London Stock Exchange's AIM Market and the Irish Sock Exchange's IEX Market. The Company has exploration assets in Algeria, Tunisia and Italy and a royalty interest in the Kinsale Head gas field in Ireland. Petroceltic is in a unique position in Algeria, operating a significant licence in partnership with Sonatrach the state oil company, one of only three AIM listed companies to enjoy this position.

Maps of the revised areas of these two licences are available on Petroceltic's web site.