PTR.L Regulatory News (PTR)

17 May 2007 07:01

Petroneft Resources PLC17 May 2007 PetroNeft Resources plc Operational Update PetroNeft Resources plc ('PetroNeft' or 'the Company'), owner and operator ofLicence 61, Tomsk Oblast, Russian Federation is pleased to provide this updateon the progress on its 2006/07 three well drilling programme and related fielddevelopment planning. Lineynoye and Tungolskoye Drilling Programme The Lineynoye and Tungolskoye Oil Fields were originally found by a SovietExploration Company in the early 1970s. The current appraisal drillingprogramme, which comprises two wells, is designed to confirm the reservoir dataof the 1970s discovery wells and provide further input into a Final DevelopmentFeasibility Study, expected to be completed in the 3rd/4th quarter of 2007. Theresults of the high value exploration well, Lineynoye No. 7, will also beincorporated into the Final Development Feasibility Study. Tungolskoye No. 4 Well The Tungolskoye No. 4 well on Licence 61 was spudded on May 16, 2007. Theprincipal target horizons for this well are Upper Jurassic sandstone reservoirsstarting at a depth of 2,490 metres. The total planned depth for the well isapproximately 3,100 metres. It is anticipated that the well will be drilled,logged and tested within approximately 70 days of commencement. Lineynoye No. 6 Well The Lineynoye No. 6 well on Licence 61 was spudded on March 4, 2007. Results ofthe initial petrophysical analysis were released on April 24, 2007, where oilwas confirmed in the Upper Jurassic J1 sandstone reservoir interval in twostratigraphic units. Flow testing of this well is currently in progress andresults will be published as soon as they are available (potentially within thenext couple of weeks). Lineynoye West Prospect. Lineynoye No. 7 Well West Lineynoye, a high impact prospect, is estimated by Ryder Scott to containPossible Reserves of approximately 67 million barrels of oil. A third rig whichwas mobilised to the site for this well is currently being assembled and is nowexpected to commence drilling in June. The principal target horizons for thiswell are again the Upper Jurassic sandstone reservoirs starting at a depth of2,375 metres. The total planned depth for the well is approximately 2,750 metresand it is anticipated that the well will also be drilled, logged and testedwithin approximately 70 days of commencement. Development Planning Pipeline Design, Survey and Approvals Contract On May 7, 2007, PetroNeft entered into a contract with "ETC Service" LLC for thedesign, survey and approval of an export pipeline from the Lineynoye andTungolskoye fields to the Transneft pipeline at the Raskino pumping station. Thecontract also includes the design and approvals for the custody transfer pointat the Transneft regional pipeline tie-in point. The award of this contract is acritical step in the ultimate development and commercialisation process inrespect of current and potential future discoveries on Licence 61. PetroNeft iscommitted to an early production date to provide positive cashflow and add valueto shareholders. Dennis Francis, Chief Executive Officer of PetroNeft Resources plc commented: "We are pleased to have spudded the second well in our three well drillingprogram and look forward to announcing the results of the Lineynoye No. 6 flowtesting program in the near future. In parallel with the ongoing drilling andtechnical work, the signing of the Pipeline Design, Survey and ApprovalsContract maintains the Lineynoye and Tungolskoye Field Development Project onschedule for first production starting in 2009." For further information, contact: Dennis Francis, CEO, PetroNeft Resources plc +1 713 988 2500 Desmond Burke, Director Investor Relations, PetroNeft Resources plc +353 52 53226 John Frain/Brian Garrahy, Davy+353 1 679 6363 Nick Elwes/Paddy Blewer, College Hill+44 207 457 2020 The information contained in this announcement has been reviewed and verified byMr. Dennis Francis, Director and Chief Executive Officer of PetroNeft, for thepurposes of the Guidance Note for Mining, Oil and Gas Companies issued by theLondon Stock Exchange in March 2006. Mr. Francis holds a B.S. Degree inGeophysical Engineering and a M.S. Degree in Geology from the Colorado School ofMines. He has also graduated from the Harvard University Program for ManagementDevelopment. He is a member of the American Association of Petroleum Geologistsand the Society of Exploration Geophysicists. He has over 34 years experiencein oil and gas exploration and development. Forward Looking Statements This announcement contains forward-looking statements. These statements relateto the Company's future prospects, developments and business strategies.Forward-looking statements are identified by their use of terms and phrases suchas "believe", "could", "envisage", "potential" "estimate", "expect", "may", "will" or the negative of those, variations or comparable expressions, includingreferences to assumptions. The forward-looking statements in this announcement are based on currentexpectations and are subject to risks and uncertainties that could cause actualresults to differ materially from those expressed or implied by thosestatements. These forward-looking statements speak only as at the date of thisannouncement. This information is provided by RNS The company news service from the London Stock Exchange