Emerald Energy Plc - 16 January 2006
OPERATIONS UPDATE - BLOCK 26, SYRIA
Emerald Energy Plc (“Emerald” or the “Company”) is pleased to provide the following update based on information released by Gulfsands Petroleum PLC (“Gulfsands”), the operator, for Block 26 (Syria) in which Emerald and Gulfsands each hold a 50% working interest:
Letters of Intent for drilling rigs
Gulfsands has executed two Letters of Intent (“LOI”) with MB Drilling Overseas Limited for the provision of drilling services. The LOI for MB Rig 21, capable of drilling the shallow Cretaceous wells, is for one well with a second well option. The LOI for MB Rig 3, a larger capacity rig for deeper drilling to the Paleozoic, will be part of a rig sharing agreement with another company operating in Syria. The rig is planned to be contracted for a one year period, with an option to extend for two additional one year periods. Negotiations on definitive rig contracts are now underway and Gulfsands expect these to be signed shortly.
Two Prospects Selected for Exploration Drilling
The first prospect to be drilled is Souedieh North and is located in the northeast region of Block 26. A vertical well will be drilled to an approximate total depth of 7,216 feet with the primary objective being Cretaceous aged reservoirs similar to those producing in the adjacent Souedieh and Karachok oil fields. The expected spud date for this well is early May 2006.
The second prospect, Tigris, is also located in the northeast region of the Block. A vertical well will be drilled to an approximate total depth of 14,760 feet with the primary objectives being a series of Carboniferous and Devonian sandstone reservoirs. The Tigris structure is directly underlying the Souedieh oil field (the largest known oil field in Syria) where oil is produced from the shallower Cretaceous reservoirs. Re-evaluation of wireline logs of an existing well on the structure drilled some years ago has identified potential hydrocarbon bearing zones within the objective reservoirs. The Tigris exploration well is designed to evaluate these reservoirs and appraise this potential hydrocarbon accumulation. The well is expected to spud in late August 2006 after the rig completes an existing long-term drilling contract in Syria with another company.
Alastair Beardsall, Emerald’s Chairman, said:
"Emerald is committed to the exploration of Block 26 and we are pleased to see the progress the operator is making in the drilling program. We believe the drilling of these first two prospects, particularly the Tigris structure, has the potential to discover significant hydrocarbons and Emerald’s share will greatly enhance our reserve base.”
Enquiries: Helen Manning 020 7925 2440
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