Sterling to Plug, Abandon Sangaw North Well

- Sterling to Plug, Abandon Sangaw North Well

Wednesday, July 06, 2011
Sterling Energy plc

Sterling provided the following update for the Sterling operated Sangaw North block in Kurdistan (53.33% working interest).

Flow testing operations have been completed in the cased hole section of the Sangaw North-1 well. Two flow tests were conducted; the first across a 100 meter interval within the Jurassic aged Sargelu formation and the second across a 100 meter interval within the Cretaceous aged Kometan formation.

During the first flow test, formation gas and water were observed in small quantities at surface but sustainable flow rates were not achieved. The Company believes that the Jurassic aged Sargelu formation does not contain a sufficient natural fracture network to support sustained flow.

During the second flow test, within the Cretaceous aged Kometan formation, the well flowed at a stabilized rate of approximately 0.4 million standard cubic feet of gas and 4,500 barrels of formation water per day during an 8 hour flow period through a 60/64ths inch choke with a wellhead pressure of 280 pounds per square inch. Approximately 83 percent of the produced gas was hydrocarbon gas with the remainder comprising 10 percent hydrogen sulphide and 7 percent carbon dioxide.

Neither flow test produced hydrocarbons at commercial rates and the Sangaw North-1 well will now be plugged and abandoned. The operations to plug and abandon the well are expected to take approximately 2 weeks, after which the drilling rig will be demobilized from the location.

The current exploration phase of the Production Sharing Contract for the Sangaw North area will expire in November 2011 and the joint venture partnership (Sterling, Addax and KNOC) may elect to enter the next exploration phase which runs until November 2013; the Sangaw North-1 well has fulfilled the work commitment for this next phase. During the coming months Sterling will integrate and analyse the seismic, drilling, logging and testing data before making recommendations to the joint venture group.

Angus MacAskill, Sterling's Chief Executive said, "We are disappointed that flow testing has not demonstrated commercial hydrocarbon flow rates in the Sangaw North-1 well. An integrated interpretation of all the data acquired during well operations will be conducted to determine the remaining potential of the Sangaw North structure prior to a decision on future operations."

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Sterling Disappointed with Sangaw North Results

- Sterling Disappointed with Sangaw North Results

Monday, June 13, 2011
Sterling Energy plc

Sterling provided the following update for the Sterling operated Sangaw North block in Kurdistan (53.33% working interest).

A flow test has been completed across the open hole section of the Sangaw North-1 well between 3,338 meters and 4,190 meters. This interval contains target horizons in the Jurassic Mus and Butmah formations and the Triassic Kurra Chine formation.

The well flowed at a stabilized rate of approximately 4.6 million standard cubic feet of gas and 7,280 barrels of formation water per day during a 12 hour flow period through a 1.5 inch choke with a wellhead pressure of 470 pounds per square inch.

Approximately 74 percent of the produced gas was hydrocarbon gas with the remainder comprising 24 percent hydrogen sulphide and 2 percent carbon dioxide.

A wireline logging operation was attempted to identify the contribution from individual zones within the open hole section but was unsuccessful due to mechanical restrictions within the flow testing equipment.

No further flow testing is planned in the open hole section of the well and this section is being isolated with cement plugs.

The joint venture partnership has elected, based on gas shows while drilling, to conduct two cased hole flow tests; the first across a 100 meter interval within the Jurassic aged Sargelu formation and the second across a 100 meter interval within the Cretaceous aged Kometan formation. Each flow test, including preparatory operations, is expected to take approximately three weeks to complete.

Angus MacAskill, Sterling's Chief Executive said, "We are disappointed that the open hole flow test has not demonstrated commercial hydrocarbon flow rates within the deeper horizons of the Sangaw North-1 well. The data acquired during this test will be integrated with all the other data acquired in well operations to determine the potential of these horizons. We look forward to the outcome of the two cased hole flow tests to be conducted in shallower formations."

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Sterling Reaches TD at Sangaw North Well

- Sterling Reaches TD at Sangaw North Well

Tuesday, May 24, 2011
Sterling Energy plc

Sterling provided the following update for the Sterling operated Sangaw North block in Kurdistan (53.33% working interest).

The Sangaw North-1 well has been drilled to a total depth of 4,190 meters, within the Triassic Kurra Chine formation. Wireline logs have been run across the open hole section and are currently being interpreted.

The joint-venture partnership has elected, based on gas shows while drilling, to conduct a flow test across the open hole section. The flow test, including preparatory operations, is expected to take approximately three weeks to complete. Further flow testing may be undertaken depending on the results of the first flow test and interpretation of the drilling and petrophysical data acquired in the well.

Angus MacAskill, Sterling's Chief Executive said, "We are pleased to have reached the planned well depth in this very challenging drilling environment and look forward to the outcome from the ongoing program of data acquisition."

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Sterling to Drill Ahead at Sangaw North Block

Sterling to Drill Ahead at Sangaw North Block

Friday, March 25, 2011

Sterling Energy plc

 

Sterling provideed the following update for the Sterling operated Sangaw North block in Kurdistan (53.33% working interest).

Sangaw North #1 Well

The side-tracked wellbore of Sangaw North #1 well has been drilled to a depth of 3,360 metres, into the top of the Jurassic formations and at a depth above where the influx of gas was recorded in the previous wellbore.

A liner has been run and cemented across the open hole interval with the liner shoe at approximately 3,340 meters.

The Company now plans to drill ahead and evaluate the Jurassic formations to a well depth of 3,660 meters and estimates this will take approximately one month. During this section, the well is expected to encounter the formations from which gas containing hydrocarbons and hydrogen sulphide entered the well in the previous wellbore. Operations are being conducted using drill pipe resistant to the effects of hydrogen sulphide.

The joint venture partners in the Sangaw North Production Sharing Contract ("PSC") may elect, in the event of encouraging results, to drill further to evaluate deeper Jurassic and Triassic formations.

Petrophysical logs have been acquired across open-hole Cretaceous intervals below 2,400 meters, the base of the intervals logged and flow tested in the previous wellbore. Preliminary evaluation of the logs acquired in the current wellbore, together with hydrocarbon shows and other information acquired while drilling, indicate the presence of hydrocarbons within these deeper Cretaceous intervals. A detailed analysis of all the data acquired is being undertaken to identify whether flow testing of certain intervals may be warranted. Flow testing of Cretaceous intervals, if undertaken, will follow any flow testing that may be undertaken in the Jurassic and Triassic intervals after they have been drilled.

Extension of Exploration Period

Sterling has received confirmation from the Ministry of Natural Resources of the Kurdistan Regional Government that the first sub-period of the exploration phase of the PSC has been extended by one year to allow for the completion of drilling operations in the Sangaw North #1 well and the evaluation of the results of this well. The first sub-period, including the one year extension, will now continue until November 2011.

Angus MacAskill, Sterling's Chief Executive said, "Operations since the gas influx and parted drill pipe in the previous wellbore have been challenging, and we are very pleased to have successfully re-drilled and cased the well to this important point in the upper Jurassic section. From here, we look forward to exploring the potential of the deeper horizons."