Operations Update
May 19 2009 - 4:34AM
UK Regulatory
TIDMTMAN
RNS Number : 4834S
Timan Oil & Gas Plc
19 May 2009
Timan Oil & Gas plc ("Timan" or the "Company")
Operations Update
Timan Oil & Gas plc is pleased to provide the following update on its operations
over the first 4 months of 2009.
NGPT
In spite of previously announced cash flow delays, the Company has drilled 3 new
wells while progressing its development plans for the field as far as possible.
The German drilling contractors, BLZ Geotechnik GmbH ("BLZ"), drilled the first
two wells of the extended 25 well pilot program using modified drilling
techniques approved by the Company's technical consultants (G.E.O.S), and taking
into account previous pilot scheme results. Instead of the usual cement,
swellable clay (in the form of "clay balls") was used in the completion in an
attempt to improve production zone isolation. The wells were successfully
completed at the target depth, cased, equipped with production tubing and
tested. The well testing continued for 6 days with periodic well production due
to the limited oil storage facilities at the field. The preliminary test results
of the first well showed reasonable production rates in line with expectations,
testing at up to 1 cubic meter (7.3 barrels) of liquid (oil and water)
production per 1 hour flow period. The testing of this and the second well is
continuing.
A third well has also been drilled in the extended pilot area using a local
subcontractor. This well also used new isolation and production techniques (oil
based mud, more powerful perforators and improved cementing) and showed better
that expected oil production rates during preliminary testing, which is
continuing. The well produced 0.25 cubic meters (1.8 barrels) of clean oil with
gas at a low water cut during 25 min. of testing.
It should be noted that the majority of the funds to be received from Kamanisk
in the next 5 months is likely to be used for general operations and working
capital purposes. However, the Company has already arranged and paid for
supplies to drill 10 wells.
While drilling progresses, the Company has also started a work program to resume
oil production at the existing pilot program area drilled in 2007. One well has
been tested and produced oil and water at a flow rate of approximately 10 cubic
meters (73 barrels) over a 10 hour period, which was significantly above the
rate expected. Although this initial high rate is not sustainable, the result is
nevertheless very encouraging. The same applies to the testing results for the
new wells.
Timan can confirm that the Company has complied with all its licence obligations
at NGPT and has successfully passed its annual inspection with Rosnedra and
Rosprirodnadzor. The development plan for the NGPT Field has been completed
together with TatNIPIneft, a subsidiary of Tatneft, and is currently awaiting
approval by the State Development Committee. As a result Rosnedra is expected
to approve the issue of required production permits and assign a level of
production for NGPT.
KNG Licence
The Company's KNG asset has been operated with minimal expenditure in 2009 but
the Board can confirm that all required subsoil payments have been made to the
relevant authorities. The Company is awaiting confirmation from the authorities
as to what payment is required in order to obtain a production licence for the
KNG area. It should be noted that the issue of the production license is only
conditional on this payment since the Company has received the Certificate of
Commercial Discovery from the Russian Federal Subsoil Agency (Rosnedra).
Geoterm
Exploration efforts have continued on the Company's blocks in the Caspian Sea.
On the Izberbash Block, Federal authorities have recently approved the Company's
exploration programme, following interpretation of extensive 2D seismic, and the
identification of four potential well locations.
Exploration on the Sulak Block will be progressed, subject to funding, with 535
km of new 2D seismic acquisition planned for 2009, along with an electrical
survey designed to help high-grade exploration prospects on both blocks. The
Company anticipates that acquisition, interpretation and processing of the data
obtained will take approximately 6 months to complete. Preparations are ongoing
and Geoterm is currently obtaining necessary approvals for conducting this work.
The Company can also report that the Federal authorities have confirmed that all
its exploration obligations have now been fulfilled on these licenses.
Enquiries:
Timan Oil & Gas plc
Alexander Kapalin, Chief Executive Officer
Boris Litvak, Non-Executive Chairman
+7 495 223 3390
Strand Partners Limited
Rory Murphy/Simon Raggett
+ 44 (0) 20 7409 3494
Technical Review
The technical information and opinions contained in this announcement have been
reviewed by Dr. Boris Litvak, Non-Executive Chairman, who is a qualified
reservoir engineer, has over 27 years of experience in oil and gas industry in
the USA, Europe and Russia and who is a member of the Society of Petroleum
Engineers.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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