26th Aug 2008 16:17
For Immediate Release
26 August 2008
LENI GAS & OIL Plc
("LGO" or "The Company")
US Gulf of Mexico - Operations Update
Leni Gas & Oil Plc the oil & gas exploration, development and production company today provides an operations update on its US Gulf of Mexico operations.
The Eugene Island A-7 well, in which LGO has a direct interest through its 28.94% holding in Byron Energy Pty Ltd ("Byron") is currently being completed for production. The A-7 well, operated by Leed Petroleum ("LDP"), did not produce a consistent flow rate from one of the deeper primary zones and will require further evaluation. Completion activities will now move up the wellbore and begin production from another of the primary zones.
The A-7 well has 181 feet of true vertical thickness of pay in six pay sands, and is the second well drilled in Eugene Island Block 184, with the A-8 well set to commence drilling imminently targeting a "sweet spot" from the exploration target discovered by and currently producing through the A-6 well.
On 12th August 2008 LGO announced that it increased its stake in Byron to 28.94%, which in turn has a 25% Working Interest in both Eugene Island Blocks 183 and the southern half of Block 184 (Net Revenue Interest up to 20.83% in Block 183 and 19.17% in the southern half of Block 184), including the Eugene Island 184A platform and production facilities. Byron has also a 12.5% Working Interest (Net Revenue Interest 9.58%) in the northern half Eugene Island Block 184 and 10.37% Working Interest (Net Revenue Interest 8.64%) in Eugene Island Block 172, excluding the Eugene Island 172 producing reserves and platform.
David Lenigas, Executive Chairman of Leni Gas & Oil, commented;
"Production from the Eugene Island A-7 well requires targeting multiple pay zones in order to maximize productivity from the 181 feet of true vertical thickness of pay across six sands. We are pleased with the progress made thus far and anticipate both the A-7 and A-8 well coming on-stream in the near future.
"Subsequent to our recent announcements on first gas production in Hungary and increasing our stake in Byron, our investment in the Eugene Island field reinforces the strength of our portfolio which now has producing assets in four countries, including Hungary, Spain and Trinidad."
Enquiries:
Leni Gas & Oil PLC
David Lenigas, Executive Chairman
Tel +44 (0) 20 7016 5100
Beaumont Cornish Limited
Roland Cornish
Rosalind Hill Abrahams
Tel +44 (0) 20 7628 3396
Pelham PR
Mark Antelme
Tel + 44 (0)20 3178 6242
Katherine Stewart
Tel +44 (0)20 3170 7439
Leed Petroleum has announced today the following:
Leed Petroleum PLC
("Leed" or the "Company")
Eugene Island Update
Leed Petroleum PLC, the oil and gas exploration and production company focused on the Gulf of Mexico, announces an update on activity at the Eugene Island field.
Since concluding drilling of the Eugene Island A-7 well, the Company has been working on casing and completing the well for production from one of the primary zones. The Company has not been able to produce a consistent flow rate from this zone and extended testing will be required to fully evaluate its potential.
Accordingly, in order to achieve its targeted commercial production from the A-7 well, the Company will move up the wellbore and begin producing from another of the primary zones intersected by the well. If deemed appropriate, the Company will consider returning to the deeper zone in the future. Completion of the shallower reservoir is expected to take approximately six weeks.
In the interim, the Company has performed preliminary work for the Eugene Island A-8 well. The Eugene Island A-8 well will target a superior "take-point" from the exploration target discovered by and currently producing through the A-6 well.
Since commencement of production from the secondary exploration target of the A-6 well, an extended flow test has been conducted, with the results of this test corroborating the Company's reserve estimates. The A-6 well began to make sand during the test, and while this reservoir continues to produce, the Company has reduced the flow rate to ensure operational safety. The curtailed gross test rate during August to date has averaged 988 BOEPD. Following completion of the A-8 well, the A-6 well will be recompleted as a long term producer from its primary zone, as has always been the Company's intention. It is anticipated that production rates for the A-6 will then return to previously announced levels.
The Eugene Island Blocks are located 50 miles offshore, south of Morgan City, Louisiana in the Gulf of Mexico in approximately 80 feet of water. Leed's management has built an inventory of development projects and exploration targets across the Eugene Island Block 183/184 Field.
Howard Wilson, President and Chief Executive of Leed Petroleum PLC, commented:
"We remain very confident that the A-7 well will perform to our expectations. It is unfortunate that we have experienced this delay, however, the long term development and acceleration programme for the Eugene Island 183/184 field remains on track. In addition to reserves scheduled to be produced from the A-7 well, the A-8 will develop existing reserves discovered during the current drilling programme as well as test at least one exploratory target."
NOTES TO EDITORS
Leni Gas & Oil Plc is an international oil and gas exploration, development and production company headquartered in London, trading on the London Stock Exchange's AIM index. The Company has assets in the US Gulf of Mexico, Spain, Trinidad, Hungary and Malta. LGO's strategy is delivering growth through the acquisition of proven reserves and the enhancement of producing assets in low risk countries.
Leed Petroleum PLC is an AIM quoted independent oil and gas exploration and production company. The Company's operations are concentrated in the US Gulf of Mexico and Onshore where Leed has established a significant portfolio of producing and development assets. The Company has interests in 17 offshore fields and one onshore field. Leed's strategy is to grow the Company's portfolio through organic development of its existing assets and to utilise its regional experience to identify and purchase value adding assets.
Byron is a private Australian company, incorporated in 2005. Since its incorporation, Byron has operated as an oil & gas exploration, development and production company focused on opportunities in the Gulf of Mexico and the USA
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