14 July 2008
Lansdowne Oil & Gas plc(“Lansdowne” or “the Company”)
Licensing Option Award
Lansdowne, the Dublin-based exploration company, is pleased to announce that it has been awarded a new Licensing Option in the North Celtic Sea basin, off the south coast of Ireland.
The Barryroe Licensing Option (“Barryroe Licence”) has been granted to Lansdowne (40 per cent), Island Oil & Gas plc (“Island”) (30 per cent) and Providence Resources plc (“Providence”) (30 per cent). Lansdowne will act as the operator of the licence for the period of time up to and including the acquisition of any seismic data over the acreage. Thereafter, Providence will become the operator for any drilling and development activities.
- The Barryroe Licence is over acreage which lies directly below the Seven Heads Gas Field
- Three previous wells tested oil at between 1,300 and 1,600 bopd
- Oil tested was light crude (30 to 42 API, with a high wax content)
- Potential development synergies with other Celtic Sea projects are being reviewed by the Group
- In the western part of the Barryroe Licence acreage, situated to the west of the producing Seven Heads Gas Field, the shallower section above 4000ft sub-sea is also included in the Licensing Option and this is considered to be prospective for gas
The Barryroe Licensing Option (08/1) covers the same acreage included in the Seven Heads Oil Licensing Option (03/5) previously held by the Company plus the shallower section mentioned above. The new Licence has been renamed Barryroe to avoid confusion with the Seven Heads Gas Field which is partly situated above the deeper oil accumulations. The award of this Licensing Option supersedes all arrangements under the previous Licensing Option (03/5), which ended when the previous Licensing Option expired in 2006.
Part of the Barryroe acreage lies beneath the Seven Heads Gas Field, with the boundary between the two concessions lying at 4,000ft (approximately 1,250m) sub-sea. Within the Barryroe area oil has been successfully tested at flow rates of between 1,300 and 1,600 bopd, from three exploration or appraisal wells. The reservoir sands are in the Cretaceous Middle and Lower Wealden sequences between 1,400m and 2,300m (approximately 4,600 to 7,550ft) below sea level. The oil is light (30 to 42 degrees API) and contains relatively high wax contents ranging from 12 to 22 per cent, which may require treatment to avoid production difficulties.
From the previous technical work carried out, the two main challenges to commercial development have been identified as the reservoir continuity and the high pour point of the oil caused by the high wax content.
The significant increase in the price of oil since 2006 has materially improved the likelihood that these reserves could be exploited commercially.
The work programme for the new Licensing Option will focus upon these challenges and the potential synergies in reviewing development options in parallel with other established oil accumulations in the Celtic Sea. In particular the appraisal and conceptual development work being carried out by Providence on other Celtic Sea oil accumulations may have an impact upon the development options being considered for Barryroe.
Dr. Steve Boldy, CEO of Lansdowne, commented:
Lansdowne is delighted to be awarded this new Licensing Option and to be working with Providence and Island. Potentially commercial flow rates have been recorded from the Wealden oil accumulations in Barryroe but a number of sub-surface and engineering challenges remain to be overcome before commercial development could be sanctioned. However, with the current high oil prices, technical advances and the opportunity to co-operate with other potential oil developments in the Celtic Sea, there is a good chance these challenges can be overcome. All three companies have extensive experience of the Celtic Sea and I believe combining this expertise will give the best chance of a successful development.
This resource update has been reviewed and approved by Steve Boldy, Chief Executive of Lansdowne. Steve Boldy is a geology graduate with a Ph.D from Trinity College Dublin and is a member of the Petroleum Exploration Society of Great Britain. He has 27 years experience in the oil and gas exploration sector and is a qualified person as defined in the guidance note for Mining, Oil & Gas Companies, March 2006 of the London Stock Exchange.
|Lansdowne Oil & Gas plc|
|Steve Boldy, Chief Executive Officer||01224 748 480|
|John East & Partners Limited|
|David Worlidge/Bidhi Bhoma||020 7628 2200|
Lansdowne Oil and Gas plc
Arnhall Business Park
Tel: +44 (0)1224 748480
Fax: +44 (0)1224 748481
Notes to Editors:
Three wells within the Licensing Option area have tested oil:
48/24-1 drilled by Esso in 1973/1974 tested oil from Middle Wealden sands at an aggregate rate of 1300 barrels per day
48/28-1 drilled drilled by Esso in 1974 tested oil from a Middle Wealden sand at 1527 barrels per day
48/24-3 drilled by Marathon in 1990 tested oil from Lower Wealden sands at an aggregate rate of 1619 barrels per day
Lansdowne Oil & Gas plc is an independent oil and gas exploration company listed on the AIM market in London with its operations focused on the Irish offshore North Celtic Sea basin. Its operating headquarters are in Dublin.
The Company was founded in December 2005 and admitted to AIM in April 2006 having acquired from Ramco Energy plc its portfolio of Irish exploration and appraisal assets that flank the Kinsale Head gas field and its infrastructure. The Company further expanded its North Celtic Sea portfolio through the acquisition of Milesian Oil & Gas Limited in December 2007 with its identified exploration prospects for Jurassic oil and gas. Lansdowne now holds rights through its wholly owned subsidiaries to three Standard Exploration Licences and one Licensing Option in the Celtic Sea.
Further information on Lansdowne is available at Lansdowne’s website at www.www.lansdowneoilandgas.com