SacOil Holdings Limited Lagia oil field first phase completion (3850D)

TIDMSAC

RNS Number : 3850D

SacOil Holdings Limited

28 January 2015

SACOIL HOLDINGS LIMITED

(Incorporated in the Republic of South Africa)

(Registration number 1993/000460/06)

   JSE Share Code: SCL    AIM Share Code: SAC

ISIN: ZAE000127460

("SacOil" or "the Company")

Completion of first phase development Operations - Lagia Oil field

SacOil Holdings Limited ("SacOil") through its subsidiary Mena International Petroleum Company Limited ("Mena") is pleased to announce the successful on-time completion of phase 1 of the field development operations at the Lagia oil field in Sinai, onshore Egypt.

Highlights

   --     Successful completion of hydraulic stimulation on all five existing wells.

-- Phase 2 operations to commence by June 2015, installation of steam facilities and the drilling of up to 5 additional wells

As previously reported, the aim of phase 1 was to stimulate and re-complete the five existing production wells at the Lagia oil field in order to increase production.

Operations commenced on the 4(th) January 2015 and initial production indications are positive and the Company is confident that the targeted average production of 350 barrels of oil a day will be achievable from these five wells once they are in sustained production.

The oil produced from the Lagia field is trucked to the GPC (General Petroleum Company) facilities, which is owned by Egyptian General Petroleum Corporation, approximately 300 km from the Lagia field. Payments for delivered crude are paid directly to Mena.

Following the successful completion of phase 1 the wells remain on production and SacOil is preparing and planning a second phase of field development and production optimisation to start by June 2015. This second phase includes the installation of steam facilities for a thermal recovery process on the existing production wells and the drilling of up to five additional thermal wells at the Lagia oil field, with the intent of further enhancing production and the recovery of oil at the oil field.

Commenting on the completion of phase 1 development operations, Dr Thabo Kgogo, SacOil CEO, said, "This success of our development operation at the Lagia oil field is a key milestone for SacOil. It marks our transformation from an exploration and production company into realizing revenues from the sale of crude oil. The next phase of our operations at the Lagia oil field will focus on increasing production, as well as maintaining cost efficiencies and profitability during this oil price cycle."

"The lower oil price environment is something we are obviously following very closely. For the time being our net cash position remains positive and we remain committed to our strategic focus of portfolio rationalization, capital restructuring and overall cost savings."

JSE Sponsor

PSG Capital Proprietary Limited

28 January 2015

 
 
   For further information please contact: 
 
 SacOil Holdings Limited                         +27 (0)11 
  Bradley Cerff                                   575 7232 
 finnCap Limited (Nominated Adviser 
  and Broker)                                   +44 (0) 20 
  Matthew Robinson / Christopher Raggett         7220 0500 
 FirstEnergy Capital (Financial Adviser 
  and Joint Broker UK)                          +44 (0) 20 
  Travis Inlow                                   7448 0200 
 Instinctif Partners London (UK Investor 
  Relations)                                     +44 (0)20 
  David Simonson / Anca Spiridon                 7457 2020 
 Instinctif Partners Johannesburg 
  (SA Investor Relations)                        +27 (0)11 
  Nicholas Williams / Tshepo Mophiring            447 3030

Qualified Person Review

This release has been reviewed by Bradley Cerff, Executive Director, who is a member of the Society of Petroleum Engineers with over 15 years' experience in petroleum exploration and management. Bradley Cerff has consented to the inclusion of the technical information in this release in the form and context in which it appears.

This information is provided by RNS

The company news service from the London Stock Exchange

END

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