Serica Energy Regulatory News (SQZ)

20 Dec 2006 14:30

Serica Energy plc20 December 2006 For immediate release: Wednesday, December 20, 2006 SERICA ENERGY SUCCESSFULLY TESTS GAS AND CONDENSATE IN THE NORTH SEA COLUMBUS WELL •Gross gas column of at least 125 feet encountered on the Columbus prospect •Well tested at 17.5 million cubic feet of gas per day and 1,060 barrels per day of condensate •Partners commencing discussions on appraisal and development programme for the discovery London, December 20, 2006 - Serica Energy plc (AIM and TSX Venture: SQZ) ispleased to announce that it has successfully completed testing the Columbus well23/16f-11 and confirmed the presence of a potentially commercial gas andcondensate reservoir. The well will now be suspended for possible future use ina development programme. Well 23/16f-11, a near-vertical exploration well drilled on the Columbusprospect in the UK Central North Sea, encountered a gross gas column of at least125 feet in the Paleocene Forties sands. A total of 85 feet of the reservoir wastested and the stabilised average production rates on a 56/64 inch choke duringa five hour flow period were 17.5 million cubic feet of gas per day and 1,060barrels per day of 47.5 degrees API condensate. The wellhead flowing pressurewas 1,200 pounds per square inch and the inert gas content was less than 2%. Serica will now commence discussions with its partners to determine theappraisal drilling programme for the Columbus discovery and the full extent ofthe reserves and expects that further drilling could take place in 2007 in orderto bring the discovery into production as rapidly as possible. The asset lies inclose proximity to existing production infrastructure, providing the possibilityto tie-in the discovery. Subject to regulatory and partner approvals, the interests held in Block 23/16f,in which the Columbus well has been drilled, are Serica 25% (Operator), BGInternational Limited (25%), Endeavour Energy UK Limited (25%) and EOG ResourcesUnited Kingdom Limited (25%). Under a transaction recently announced and subjectto regulatory and partner approval Serica also has a 25% interest in thepost-Cretaceous section of part of the adjacent Block 23/21 into which theColumbus structure is believed to extend. Paul Ellis, Chief Executive of Serica said that "It is an excellent result forthe Company to have produced gas at commercial flow rates in the Columbus well,particularly given the fact that the Company has gone from the award of thelicence to completing flow testing in less than one year. The successful resultof Columbus gives Serica a potential North Sea development project to add to ourexisting Kambuna gas field development in Indonesia. We have drilled four wells in the last sixteen months and have found gas in eachof them, two of which, Kambuna and Columbus are now scheduled for developmentand appraisal respectively. Next year we expect to be drilling at least sixwells in Indonesia and one or more appraisal wells in the North Sea and we lookforward to further success." Background Notes Serica Energy plc is an international oil and gas exploration company withoperations in Indonesia, the UK North Sea, Spain, Ireland and Vietnam. TheCompany's ordinary shares are listed in London on AIM and on the Canadian TSXVenture Exchange under the symbol "SQZ". The 2005 Annual Report and Accounts areavailable at www.serica-energy.com and www.sedar.com. Enquiries: Serica Energy plcPaul Ellis, pellis@serica-energy.com +44 (0)20 7487 7300Chief Executive OfficerChris Hearne, chearne@serica-energy.com +44 (0)20 7487 7300Finance Director Pelham Public Relations -UKJames Henderson james.henderson@pelhampr.com +44 (0)20 7743 6673AlisdairHaythornthwaite alisdair.haythornthwaite@pelhampr.com +44 (0)20 7743 6676 CHF Investor Relations - CanadaJan Moir jan@chfir.com +1 416 868 1079 --------------- x237Heather Colpitts heather@chfir.com +1 416 868 1079 ------------------- x223 Forward Looking Statements This disclosure contains certain forward looking statements that involvesubstantial known and unknown risks and uncertainties, some of which are beyondSerica Energy plc's control, including: the impact of general economicconditions where Serica Energy plc operates, industry conditions, changes inlaws and regulations including the adoption of new environmental laws andregulations and changes in how they are interpreted and enforced, increasedcompetition, the lack of availability of qualified personnel or management,fluctuations in foreign exchange or interest rates, stock market volatility andmarket valuations of companies with respect to announced transactions and thefinal valuations thereof, and obtaining required approvals of regulatoryauthorities. Serica Energy plc's actual results, performance or achievementcould differ materially from those expressed in, or implied by, these forwardlooking statements and, accordingly, no assurances can be given that any of theevents anticipated by the forward looking statements will transpire or occur, orif any of them do so, what benefits, including the amount of proceeds, thatSerica Energy plc will derive there from. The TSX Venture Exchange has not reviewed and does not accept responsibility for the adequacy or accuracy of this release. To receive Company news releases via email, please contact heather@chfir.com and specify "Serica press releases" in the subject line. This information is provided by RNS The company news service from the London Stock Exchange