2nd Aug 2007 07:00
Pan Andean Resources PLC02 August 2007 New Drilling in Gulf of Mexico Pan Andean Resources PLC ('Pan Andean') the AIM listed oil and gas producer(AIM: PRE) is pleased to announce that drilling of an exploration well on blockHigh Island 52 ("HI 52") in the Gulf of Mexico will commence within the nextseven days. The well will be drilled by our farm in partner PhoenixExploration. In 2006 a farm in deal was agreed with Phoenix Exploration,whereby they have an option to drill the deep plays on most of block HI 52. PanAndean holds a 2.15% royalty. Under the terms of the deal, Pan Andean will alsobenefit from the release of abandonment liabilities. The well will take about a month to complete and will be drilled to a depth ofaround 8000 feet. The well is a side track well and will target a zone expectedto have gas reserves. If successful, the well will be tied back to existingfacilities and will be put into production. Additional exploration wells,targeting deeper zones, may be considered by our farm in partner. Pan Andean holds a 50% working interest in HI 52 and a 1.32% royalty on leasenumber 508, located in the north east quarter of the block. Lease number 508,was farmed out in 2000 to Gryphon Exploration. Gryphon drilled three successfulwells currently producing gas. The royalty to Pan Andean from this productionis in excess of $150,000 a month. Managing Director, David Horgan said: Our US assets continue to provide important cash flow to Pan Andean while alsohaving upside potential. We are delighted that Phoenix has seen the opportunityof HI 52 and have been able to obtain a drilling rig. We are also continuing to work with our partner Hunt Oil to bring HI 30 backonline. A jack-up rig is repairing leaks in the pipeline to shore. These leakswere discovered while testing the pipeline prior to production. This work isexpected to be completed within weeks and following successful testingproduction is expected to commence. Background Pan Andean was founded in 1988. The group has assets in Bolivia and Peru andimportant working interests and minority holdings in the United States in theGulf of Mexico and Texas. Pan Andean seeks to identify and access opportunitiesin frontier and established basins in South America The announcement has been approved by Mr Ivan Sandrea, Director Pan Andean. MrSandrea has more than 10 years of international E&P experience. Contacts: David Horgan, Managing Director + 353 87 292 3500John Teeling, Chairman + 353 1 833 2833 College HillPaddy Blewer + 44 (0)20 7457 2074Nick Elwes Blue Oar SecuritiesJohn Wakefield + 44 (0) 1179 330020 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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