1st Dec 2008 07:00
FOR IMMEDIATE RELEASE
1 December 2008
MELROSE RESOURCES PLC
Bulgarian Gas Storage Project Update
Melrose Resources plc (LSE: MRS) ("Melrose" or "the Company") the oil and gas exploration, development and production company today provides an update on its Bulgarian gas storage project.
In late 2007 Melrose signed a Memorandum of Understanding with Bulgargaz Holding EAD ("Bulgargaz"), the Bulgarian state-owned gas utility company, under which the two companies conducted a joint feasibility study to evaluate the conversion of the Melrose operated Galata gas field into a gas storage facility.
The study concluded positively and plans are being brought forward to convert the field to gas storage with first injection commencing in the third quarter of 2009. The storage capacity will be developed in phases over a three year period with a total capital expenditure of $90 million being required to create usable storage capacity of 1.8 billion cubic meters.
The storage project continues to receive strong support from the Bulgarian Government, which wishes to supplement Bulgaria's existing gas storage capacity in order to ensure a secure and well modulated gas supply and to comply with current European Union guidelines.
Melrose and Bulgargaz now plan to enter into a second agreement under which Bulgargaz has the right to become an equity partner in the Galata gas storage project and acquire up to a 40% working interest by contributing its proportionate share of the capital costs and cushion gas requirements. It is expected that Bulgargaz will acquire this interest when first gas injection commences.
Commenting on this update, David Thomas, Chief Executive, said:
"This is a very positive development for the Galata gas storage project. Melrose and Bulgargaz have a strong, longstanding relationship and we are looking forward to working with them to develop a fully integrated gas storage and supply system. They have a great depth of experience in the Bulgarian gas business and, as the primary initial user of the new storage facility, their partnership in the project will help promote and maximise the facility's usage."
For further information please contact:
|
Melrose Resources plc David Thomas, Chief Executive Robert Adair, Executive Chairman Munro Sutherland, Finance Director |
0131 221 3360 |
|
Buchanan Communications Ben Willey Ben Romney |
0207 466 5000 |
or visit www.melroseresources.com
Disclaimer
This announcement contains certain forward-looking statements that are subject to the usual risk factors and uncertainties associated with the oil and gas exploration and production business. While Melrose believes the expectations reflected herein to be reasonable, the actual outcome may be materially different owing to factors either within or beyond Melrose's control, and accordingly no reliance may be placed on the figures contained in such forward looking statements.
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