Xtract Regulatory News (XTR)

14 Mar 2008 11:16

Xtract Energy plc14 March 2008 14 March 2008 AIM: XTR XTRACT ENERGY PLC ("Xtract" or the "Company") PROJECT UPDATE - MEO Australia Ltd Xtract refers shareholders to the following press releases announced inAustralia by MEO Australia Ltd ("MEO"). Xtract currently holds approximately 15.7% of the issued capital of MEO. "ASX AND MEDIA RELEASE BLACKWOOD-1 UPDATE Key Points:• 2473 Bcf Contingent Resource estimate in Greater Blackwood• Casting basin site selection initiated to secure construction site for TSMP MELBOURNE, AUSTRALIA (March 14, 2008) - MEO Australia Limited (ASX: MEO)provides the following preliminary Contingent Resource estimates for the GreaterBlackwood structure based on initial interpretation of the Blackwood-1 drillingresults. Blackwood-1 has confirmed 49m of gross Plover gas bearing sands to a preliminarygas-water contact (GWC) at 3225mMD (3188m subsea). While the actual GWC has notbeen finalized and may be deeper thereby increasing the potential ContingentResource, the GWC is considered conservative and is the basis for the ContingentResource calculations provided below. Blackwood-1 also encountered 13m of grossFlamingo gas charged sands. However, MDT recovery was not successful in thisupper zone due to borehole damage and no part of the Contingent Resourceestimate includes any potential gas in the Flamingo sands. Structure Raw Gas (including CO2) Contingent Resource GIP (P50 - "most likely"): BcfBlackwood 1428Blackwood East 1045Totals 2473 "Contingent resources" are those resources which relate to quantities ofpetroleum (oil or gas) which are estimated to be potentially recoverable from aknown accumulation but which are not yet considered to be commerciallyrecoverable. Contingent Resources may include, for example, accumulations whereevaluation of the accumulation is still at an early stage and further appraisaldrilling is required. Based on the current assumptions of a 60% net to gross and 10% matrix porosity,it would be reasonable to assume a 70% recovery factor, which would indicatethat Blackwood may offer approximately 1700 Bcf of raw recoverable gas. The first methanol plant proposed for the Tassie Shoal Methanol Project requiresapproximately 1400 Bcf of raw gas (including inerts) to produce 1,750,000 tonnesper annum for 20 years of operation. Given the encouraging results from the Blackwood-1 well and indications of apossible gas resource adequate in volume and quality to supply a methanol plant,MEO has accelerated the selection process to identify and secure a casting basinsite in Southeast Asia for the possible construction of the concrete gravitybase structure. The Company has also initiated the development of the Basis ofDesign documentation in preparation for the commencement of Front EndEngineering and Design (FEED) studies of the Tassie Shoal Methanol Project(TSMP) later in the year. On December 23, 2002, the Commonwealth Minister for the Environment and Heritagegranted approval for the TSMP to construct, install, commission and operate two1,750,000 tpa plants until November 29, 2052. As previously advised, now that a hydrocarbon accumulation has been confirmed inthe Blackwood structure, further seismic evaluation will be undertaken and asecond well will be required to appraise and production test the Ploversandstone reservoir. The proposed Blackwood-2 well is likely to be fully casedand may be designed for retention as a future production well. C.R.Hart, Managing DirectorMEO Australia LimitedNT/P68 Operator" "ASX AND MEDIA RELEASE HERON-2 UPDATE Key point:• Heron-2 formally declared a hydrocarbon discovery well MELBOURNE, AUSTRALIA (March 11, 2008) - MEO Australia Limited (ASX: MEO) advisesthe market that following careful analysis of the production testing results andelectric log data through the Heron North Elang/Plover sandstone unit, formaldeclaration of a discovery pursuant to clause 34 of the Petroleum (SubmergedLands) Act 1967 has been made to the Designated Authority. Heron-2 was drilled by Seadrill's West Atlas jack-up rig contracted to MEO fortwo firm wells. The Heron-2 well penetrated the Epenarra Darwin Formation andthe deeper Elang/Plover Formation of the Heron North structure. Electric loggingindicated that both of the target reservoirs were gas saturated. Productiontesting of the Heron North Elang/Plover sandstone unit recorded a maximuminterpreted hydrocarbon flow between 6 and 8 MMscf/day before operations werehalted due to the approach of Cyclone Helen. Further testing was not successfuldue to the partial collapse of the well. Given the encouraging mud log indications while drilling the Plover formation ofpossible wet gas (gas with associated LPG and condensate), a significant grosscolumn (164m) of Plover gas saturated sands and positive electric loginterpretation, the joint venture is currently planning a re-drill of the HeronNorth structure to production test the Plover sandstone unit. The participants in the Heron-2 well and permit are:TSP Arafura Petroleum Pty Ltd (MEO subsidiary) 45%Oz-Exoil Pty Ltd (MEO subsidiary) 45%Petrofac Energy Developments Oceania Ltd (Petrofac Limited subsidiary) 10% C.R.Hart, Managing DirectorMEO Australia LimitedNT/P68 Operator" Andy Morrison commented: "Today's announcement by MEO plus the recent formalannouncement of a discovery in the previous Heron-2 well demonstrate significantprogress." Further information on MEO can be found at www.meoaustralia.com.au. As an ASXlisted company, MEO is not subject to the AIM Rules and these drilling updateshave not been reviewed by a named "qualified person" as defined and required bythe AIM Guidance Note for Mining, Oil and Gas Companies. Enquiries please contact: Xtract Energy plc Andy Morrison, CEO +44 (0) 20 7079 1798 Smith & Williamson Corporate David Jones +44 (0) 20 7131 4000Finance Limited Azhic Basirov Scott Harris Stephen Scott +44 (0) 20 7653 0030 Annabel Michie For further Information on Xtract please visit www.xtractenergy.co.uk About Xtract Energy Plc Xtract identifies and invests in a diversified portfolio of early stage energysector technologies and businesses with very significant growth potential. Weaim to work closely with the associated management teams to achieve criticalproject milestones, to finance later development stages and to build andcrystallise value for all shareholders and partners. Xtract is supported by its cornerstone investor, Cambrian Mining Plc (AIM:CBM) adiversified resource investment house which together with its wholly ownedsubsidiary Cambrian Investments Holdings Limited holds approximately 50.12% ofthe issued share capital of the Company. A short description of the principal assets of Xtract is set out below. Theseassets are either held directly or through wholly owned subsidiaries of theCompany. MEO Australia MEO is focused on developing gas-to-liquids ("GTL") projects in the Timor SeaAustralia, in an area of shallow water known as Tassie Shoal. It has securedCommonwealth Government environmental approvals for two large scale (1.8 Mtpa)methanol plants (50 per cent. interest) and a 3 Mtpa LNG plant (100 per cent.interest) which are adjacent to the Evans Shoal gas field. Elko Energy Elko is an oil & gas exploration company which has an interest in a 5,370km2exploration and production licence in the Danish North Sea and an investment inDragon Energy Inc, a private Canadian company, with a development project inGansu Province, China. Wasabi Energy Wasabi is a diversified investor in renewable energy and low greenhouse emissiontechnologies, with interests in geothermal waste/heat, uranium exploration inAustralia's Northern Territory and biodiesel investments in Victoria. Central Asian Interests Xtract's Central Asian interests include a production sharing agreement withKyrgyzneftegaz to instigate a water injection project on the Beshkent- Togap oilfield. Xtract also holds interests in several exploration licences in the TashKumyr area and in the Toktogul exploration licence. Oil ShaleXtract has oil shale and related petroleum product exploration rights overmining tenements in the Julia Creek area of Queensland and was granted anexploration permit which gives rights to explore for oil shale in an area in theSouth of New Zealand. It is investigating the commercial production ofhydrocarbons (crude oil) from oil shale. Xtract is also available for trading on the open market segment of the FrankfurtStock Exchange (ticker R9X.FSE). This information is provided by RNS The company news service from the London Stock Exchange