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12 Sep 2011 07:39
12 September 2011
The ManagerCompany AnnouncementsAustralian Securities Exchange LimitedLevel 06, 20 Bridge StreetSydney NSW 2000By e-lodgement
TRINIDAD AND GEORGIA DRILLING UPDATE
International oil and gas exploration, development and production company, Range Resources Limited ("Range" or "the Company") is pleased to announce the following updates with respect to the Company's Trinidad and Georgian Operations.
Trinidad
Range is pleased to announce that the first well drilled by one of its subsidiaries, Trincan Oil Limited, in the Company's initial 21 well program in the Morne Diablo Block, onshore Trinidad, has been successfully completed with a down hole pump and pump jack having been installed with the well producing high quality 36 degree gravity oil at initial water-free test rates of approx 20 bopd. Higher rates will depend on final pump selection and depletion by offset well bores.
It is important to note that this first well was a replacement in fill well to an old well, hence the Company is extremely pleased with the success of this replacement well given the higher than expected net pay zone encountered. A total of 3 of the current 21 wells in the program are replacement wells, as opposed to step out wells.
Following on from the success of the first well, Rig 1 commenced and completed a step out well targeting the Lower Forest sands at a depth of approximately 1,000 feet. Surface casing was run to 100 feet and drilling reached target depth. Open hole logs have been run with results indicating extremely attractive resistivity oil sands across 215 feet. Completion plans have been lodged for approval with local authorities with an aim to have the well completed and producing within the week.
The recently certified Rig 2 is now fully operational and has been moved to the third well location (also step out well) to commence drilling. Rig 3 is scheduled to join and accelerate the current development well program once certified over the coming week or two.
The Company is buoyed by this early success and remains confident of increasing production to between 1400 - 1800 bopd from this initial programme in Trinidad.
Georgia
Following the successful setting of casing to 700m and the installation of the blowout preventer ("BOP"), drilling has recommenced and is currently at 1,339m.
Drilling with continue to approximately 2,500m at which point 9 5/8" casing will be set before drilling will recommence out to a target total depth of approximately 3,500m, which is expected to be reached in late September.
The Mukhiani Well is targeting the Vani 3 prospect which has the following estimated undiscovered stock tank oil-in-place ("STOIIP"):
Vani 3 Prospect - STOIIP (MMbbls)
P90 P50 P10 Mean
Gross (100%) 41.7 92.7 178.2 115.2
Net Attributable to Range (40%) 16.7 37.1 71.3 46.1
The recently completed geochemical helium survey undertaken by Range confirmed the suitability of the first drill location with oil exploration and development prospectivity complementing the earlier seismic work completed on the target.
Corporate Update
The Company would also like to announce that it has extended its equity line of credit facility for an extra £30m with First Columbus / Duchess.
The Company is fully funded for its exploration activities with existing cash reserves and circa $15m still due from the exercise of `in-the-money' options due to expire before the end of 2011, however in the event of a discovery on any of the Company's high impact exploration wells being drilled in the coming months, with this extension of the equity line of credit in place, the Company will have immediate access to funds for any appraisal operations that would be necessary should these exploration wells result in a discovery.
Issue of Shares and Options
The Company is also pleased to announce the issue of the following securities:
* 6,299,740 Ordinary Fully Paid Shares being issued upon exercise of listed options ($0.05, 31 December 2011) * 5,000,000 Ordinary Fully Paid Shares being issued in lieu of corporate advisory, consultancy and facilitation fees * 17,921,146 Class A Performance Shares as approved by shareholders at the General Meeting - 23 June 2011 * 17,921,146 Class B Performance Shares as approved by shareholders at the General Meeting - 23 June 2011
Following the issue of these securities the total number of securities in the Company on issue are as follows:
1,718,195,675 Ordinary Fully Paid Shares (RRS) 191,478,121 Listed Options (RRSO) (A$0.05, 31 December 2011) 855,166 Unlisted Options (£0.04, 30 June 2015) 7,058,824 Unlisted Options (£0.17, 30 April 2016) 60,000,000 Unlisted Directors Options (A$0.10, 31 Dec 2011) 3,177,029 Unlisted Options (A$0.50, 30 June 2012) 17,921,146 Class A Performance Shares 17,921,146 Class B Performance Shares
Range has applied for admission of the new shares to trading on the ASX and AIM markets. All of the shares are expected to be admitted to trading on AIM on or around 16 September 2011.
For and on behalf of the Board
RegardsPeter LandauExecutive DirectorContactsRange Resources LimitedPeter LandauTel : +61 (8) 8 9488 5220Em: plandau@rangeresources.com.auAustralia LondonPPR Tavistock CommunicationsDavid Tasker Ed Portman/Paul YouensTel: +61 (8) 9388 0944 Tel: + 44 (0) 20 7920 3150Em: david.tasker@ppr.com.au Em: eportman@tavistock.co.ukRFC Corporate Finance (Nominated Advisor) Old Park Lane Capital (Joint Broker)Stuart Laing Michael ParnesTel: +61 (8) 9480 2500 Tel: +44 (0) 207 493 8188 Panmure Gordon (Joint Broker) Katherine Roe / Brett Jacobs Tel: +44 (0) 207 459 3600Range Background
Range Resources Limited is a dual listed oil & gas exploration company with oil & gas interests in the frontier state of Puntland, Somalia, the Republic of Georgia, Texas, USA and Trinidad.
* In Trinidad Range recently completed the acquisition of a 100% interest in holding companies with three onshore production licenses and fully operational drilling subsidiary. Independently assessed gross recoverable 3P reserves in place of 6.9 MMbls (on a mean 100% basis) with an additional 20 MMbls of prospective resources. * In the Republic of Georgia, Range holds a 40% farm-in interest in onshore blocks VIa and VIb, covering approx. 7,000sq.km. Currently, Range has recently completed a 410km 2D seismic program with independent consultants RPS Energy identifying 68 potential structures containing an estimated 2 billion barrels of oil-in-place (on a mean 100% basis) with the first of two exploration wells having spudded in July in 2011. * In Puntland, Range holds a 20% working interest in two licences encompassing the highly prospective Dharoor and Nugaal valleys with the operator and 45% interest holder, Africa Oil Corp planning to commence the two well programme in 2011 (targeting (on a mean 100% basis) 300mmbls and 375mmbbls of best estimate gross recoverable oil in place) following the recent awarding of the rig contract. * Range holds a 25% interest in the initial Smith #1 well and 20% interest in further wells on the North Chapman Ranch project, Texas. The project area encompasses approximately 1,680 acres in one of the most prolific oil and gas producing trends in the State of Texas. Drilling of the first well has resulted in a commercial discovery with independently assessed gross recoverable reserves in place (on a mean 100% basis) of 240 Bcf of natural gas, 18 mmbbls of oil and 17 mmbbls of natural gas liquids. * Range holds a 21.75% interest in the East Texas Cotton Valley Prospect in Red River County, Texas, USA, where the prospect's project area encompasses approximately 1,570 acres encompassing a recent oil discovery. Independently assessed gross recoverable reserves in place (on a mean 100% basis) of 5.4 mmbbls of oil.
The reserves estimate for the North Chapman Ranch Project and East Texas Cotton Valley has been formulated by Lonquist & Co LLC who are Petroleum Consultants based in the United States with offices in Houston and Austin. Lonquist provides specific engineering services to the oil and gas exploration and production industry, and consults on all aspects of petroleum geology and engineering for both domestic and international projects and companies. Lonquist & Co LLC have consented in writing to the reference to them in this announcement and to the estimates of oil, natural gas and natural gas liquids provided. These estimates were formulated in accordance with the guidelines of the Society of Petroleum Engineers ("SPE"). The SPE Reserve definitions can be found on the SPE website at spe.org.
The reserves estimates for the 3 Trinidad blocks referred above have been formulated by Forrest A. Garb & Associates, Inc. (FGA). FGA is an international petroleum engineering and geologic consulting firm staffed by experienced engineers and geologists. Collectively FGA staff has more than a century of worldâ€"wide experience. FGA have consented in writing to the reference to them in this announcement and to the estimates of oil and natural gas liquids provided. The definitions for oil and gas reserves are in accordance with SEC Regulation Sâ€"X.
RPS Group is an International Petroleum Consulting Firm with offices worldwide, who specialise in the evaluation of resources, and have consented to the information with regards to the Company's Georgian interests in the form and context that they appear. These estimates were formulated in accordance with the guidelines of the Society of Petroleum Engineers ("SPE").
The prospective resource estimates for the two Dharoor Valley prospects are internal estimates reported by Africa Oil Corp, the operator of the joint venture, which are based on volumetric and related assessments by Gaffney, Cline & Associates.
In granting its consent to the public disclosure of this press release with respect to Trinidad, Petrotrin makes no representation or warranty as to the adequacy or accuracy of its contents and disclaims any liability that may arise because of reliance on it.
www.rangeresources.com.au
London
5th Floor, 23 King Street, St. James's House, London SW1 6QY t: +44 207 389 0588, f: +44 207 930 2501
Australia
Ground Floor, 1 Havelock Street, West Perth WA 6005, Australia t: +61 8 9488 5220, f: +61 8 9324 2400
e: admin@rangeresources.com.au
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