Emerald Energy Plc - 30 January 2006
OPERATIONS UPDATE - BLOCK 26, SYRIA
Emerald Energy Plc (“Emerald” or the “Company”) is pleased to provide the following update for Block 26 (Syria) in which Emerald holds a 50% working interest through its 100% owned subsidiary SNG Overseas Ltd.
A detailed review of drilling records and wireline logs of six wells previously drilled to test Palaeozoic reservoirs within Block 26 has concluded that three of the wells encountered potential commercial hydrocarbon accumulations. The largest of these potential accumulations, the Tigris structure, is located beneath the Souedieh Field, the largest oil field in Syria. The Production Sharing Contract for Block 26 grants oil and gas rights to all reservoirs beneath the existing fields within the block, such as the Palaeozoic aged Tigris structure, and oil and gas rights to all depths in areas outside of the existing producing fields.
Ryder Scott Company LP (“Ryder Scott”) has prepared an independent study of the recoverable gross reserves for the Tigris structure using the reserve definitions approved by the Society of Petroleum Engineers and the World Petroleum Congress. The data used for the study includes wireline logs from a well drilled to the Palaeozoic in the Tigris structure in 1994, and an extensive 3D seismic survey available over the Souedieh Field. Reserve and resource figures are stated in billions of cubic feet of natural gas (bcf), millions of barrels of oil (mmbbl) and millions of barrels of oil equivalent (mmboe) where six thousand cubic feet of natural gas is equivalent to one barrel of oil.
The Tigris structure is potentially large but with only one well bore on the structure. Based on data currently available, the Ryder Scott report concludes that there are nine potentially productive zones contained within Palaeozoic age reservoirs penetrated by the existing well bore. As the available data is insufficient to determine the expected hydrocarbon fluid contained within the structure, Ryder Scott developed two cases for this evaluation: a gas case and an oil case.
If Tigris is a natural gas accumulation, Ryder Scott has classified 442 bcf as Probable Reserves, a further 442 bcf as Possible Reserves, and a further 3447 bcf as a Prospective Resource. In summary, total hydrocarbon potential for Probable and Possible Reserves and Prospective Resource in this case is 4330 bcf, equivalent to 722 mmboe.
If Tigris is an oil accumulation, Ryder Scott has classified 104 mmbbl of oil and 64 bcf of gas as Possible Reserves and a further 408 mmbbl of oil and 245 bcf of gas as Prospective Resource. In summary, total hydrocarbon potential for Possible Reserve and Prospective Resource in this case is 512 mmbbl and 308 bcf, equivalent to 563 mmboe.
Emerald’s 50% participating interest in the Tigris structure and it potential reserves, is subject to the fiscal terms of the Production Sharing Contract.
A Letter of Intent has been signed with a drilling contractor to drill a well on the Tigris structure and plans are underway to commence drilling in August 2006.
Alastair Beardsall, Emerald’s Chairman, said:
"The results of this evaluation are very encouraging. The reserves identified in the independent reserves report prepared by Ryder Scott add significantly to our confidence in a positive outcome for the exploration well to be drilled on Tigris in August 2006. Confirmation of these reserves by the Tigris well will greatly enhance our reserves base.”
Enquiries: Helen Manning 020 7925 2440
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