WRES.L Regulatory News (WRES)

8 Jun 2005 10:04

Caspian Holdings plc08 June 2005 8 June 2005 CASPIAN HOLDINGS PLC ("Caspian" or "the Company") Drilling, Production and Export Update Caspian Holdings announces that it has progressed drilling and oil activities,completing and bringing into production Well 107 and increasing overallproduction rates in the Zhengeldy field. Drilling has also been completed on well 116 and commenced on new Well 106. Well 107, which had a net oil pay of 17m in the Neocomian structure, has beenperforated to 5m (2 intervals) and currently, one of the intervals been broughtinto production. . The current production capacity of the Zhengeldy field is now based on a totalof five wells: four across Jurassic levels (Wells 113, 114, 112 and 111); andWell 107, at Neocomian levels. Production rates have been steady at 130-150 barrels per day and are anticipatedto increase in June with the addition of production from Well 107. Subject tothe results of testing we also expect additional production from Wells 106, 116and the perforation of Well 114 in the Neocomian. In addition productionincreases are expected from a new approach to cementation and logging which theCompany has developed in conjunction with Schlumberger Caspian Region.Evaluation of cement bond logs suggests there is significant scope to improvewell cementation and, as a result, to identify additional productive levels. During May, Caspian continued to evaluate opportunities for bringing on Triassiclevel production. Well 106, a twin of old well number 5, is now being drilled(to a target depth of 750m (currently at a depth of 600m)) and should becomplete in late Q2, 2005. Joint review of Well 115 with the Mining EconomicConsulting Company has recommended a re-investigation of three more levels inthe Triassic which the Company is planning for Q3, 2005. Planning is advanced for drilling on the salt lake in the west of the Zhengeldylicence area in summer and well locations will be selected following a review ofgeological models of the Zhengeldy field. Work is continuing in evaluatingtargets in the Zhengeldy extension area as the Company awaits a decision on itsextension application - a decision is expected in Q3, 2005. Caspian has progressed construction of a 200 tonne storage and export facility.The proposed facility will now be located outside Makat on the new pipelineentry point, following a decision by Emba Oil, the state oil company to relocateprocessing operations to this site (away from the city). The initial plan is totransfer 200 tonne batches to the main Emba storage tanks with subsequent exportin 1000 tonne lots. A heating process step will be added to storage facilitieson the Zhengeldy site to reduce salt content in crude for both domestic andexport sales. Both the processing step and the export storage facility should becomplete in July 2005. The Company's Annual General Meeting will be held in London on 26 July 2005 anda notice of meeting will shortly be sent to shareholders. Michael Masterman, Executive Chairman of Caspian Holdings commented: "Following our preliminary results on 26th April, we felt it was important toupdate shareholders of Caspian's development with a current overview. We areconfident in our ability to increase production rates and we are excited aboutthe discovery of oil production in the Neocomian structure in the Zhengeldypermit area." - Ends - For further information, please contact: Caspian Holdings Plc Hoodless Brennan Parkgreen CommunicationsMichael Masterman Luke Cairns Justine Howarth / Ana RibeiroT: +447791288381 T: +44 (0) 20 7538 1166 T: +44 (0)20 7493 3713 This information is provided by RNS The company news service from the London Stock Exchange