Egdon Posts Initial Production Rates at Keddington

- Egdon Posts Initial Production Rates at Keddington

Friday, May 27, 2011
Egdon Resources plc

Egdon provided an update on production testing of the Keddington-4 well in Egdon's operated license PEDL005 (Remainder) located in Lincolnshire.

The Keddington-4 well was drilled as a re-entry and horizontal sidetrack from the Keddington-1Z "donor" well, during April 2011 and encountered a total of 120 meters of the primary reservoir Unit 1 sandstone and 65 meters of Unit 2.

Site reinstatement works have been completed and the Keddington-4 well commenced pumping operations on Monday, May 23, 2011 at 08.30 hours. After initial recovery of kill-brine and oil-based drilling mud, the well began free-flowing oil and gas through an adjustable choke and the pump was shut-off. The well has been shut-in periodically to observe pressure behavior. Free-flowing production over a flowing period of 68 hours to 07.30 on May 27, 2011 has yielded 647 barrels of oil along with 1,106,300 cubic feet of gas on a minimum choke setting. The production rate for the 24 hours to 07.30 hours on May 27, 2011 was measured at 234 barrels of oil per day ("bopd") and 518,000 cubic feet of gas per day ("cfg/d"). No formation water has been observed to date.

It is intended to continue to produce the Keddington-4 well over the coming few weeks to determine the optimum rate and methods of producing the well. Production from the adjacent Keddington-3z well, which was producing at constrained rates of 100 bopd and 650,000 cfg/d prior to being shut-in during the drilling operations, will resume in the coming weeks once stable production has been established from Keddington-4.

We will provide further updates once stable oil and gas rates for the field are established.

Egdon holds a 75% operated interest in PEDL005(Remainder). The joint venture partners are Terrain Energy Limited (15%) and Alba Resources Limited (10%), a wholly owned subsidiary of Nautical Petroleum.

Commenting on the production testing operations, Egdon's Managing Director Mark Abbott said, "We are pleased by these initial production results from the Keddington-4 well. The good oil rates, lack of any observed formation water and current gas production from the well are all encouraging. We will continue to flow and monitor the well over the next few weeks as we look to define the optimum production strategy for the well and the field as a whole."

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Egdon Updates Ops at Kirkleatham, Keddington

Egdon Updates Ops at Kirkleatham, Keddington

Wednesday, April 27, 2011
Egdon Resources plc

Egdon Resources provided an update on operations at two key UK projects.

Egdon reported that first gas flows were achieved on April 19, 2011 at the Kirkleatham gas development in PEDL068 where the Company holds a 40% operated interest. The joint venture partners are Sterling Resources (UK) Ltd (47%), Yorkshire Exploration Limited (8%) and Montrose Industries Limited (5%).

During the early stages of production from the field, gas flow rates and their duration will be restricted as system performance and gas quality is monitored and training undertaken of the site operatives. It is expected that flow rates will be gradually ramped up to the maximum of around 5 million cubic feet of gas per day and 24 hour operations will commence in the coming weeks.

The gas from Kirkleatham is sold to Sembcorp Utilities (UK) Limited, the operator of the Wilton site for use in their GT2 gas turbine power plant.

Egdon also reported that drilling operations have now been completed at Keddington-4 in Lincolnshire license PEDL005(Remainder) where Egdon holds a 75% operated interest. The joint venture partners are Terrain Energy Limited (15%) and Alba Resources Limited (10%), a wholly owned subsidiary of Nautical Petroleum.

The Keddington-4 well was drilled as a re-entry and horizontal sidetrack from the Keddington-1Z "donor" well, which was drilled by Candecca Resources in 1998. The British Drilling and Freezing Limited BDF28 drilling unit mobilized to site on April 1, and operations began on 4 April. The plugging-back of the existing well was completed and the drilling of the sidetrack commenced at 0700 hours on 9 April from a kick-off depth of 2080 meters. The well reached its total depth of 2468 meters at 1800 hours on April 22. A total of 120 meters of the primary reservoir Unit 1 sandstone with high gas readings indicative of the presence of oil was penetrated some 6 meters shallower than in the Keddington-1Z well. An additional 65 meters of Unit 2 was also drilled. Due to borehole stability concerns, it was decided not to deepen the well as planned to penetrate the "Namurian" sandstones, which had gas indications in Keddington-3. Keddington-4 has now been completed for pumped production with a slotted liner over the entire horizontal section of the well. Once the drilling rig has demobilized from site later this week all surface facilities will be reinstated and the well put into production. Production from the adjacent Keddington-3z well, which has been suspended for safety reasons during the drilling operations, will resume once Keddington-4 has been tested.

Commenting on these developments Egdon's Managing Director Mark Abbott said, "Having achieved the milestone of first gas at Kirkleatham, we now look forward to achieving optimum production rates in the coming weeks. The presence in Keddington-4 of a significant section of Unit 1 reservoir up-dip of the Keddington-1Z well is encouraging and we look forward to the results of production from this well during early May."

Egdon Commences Drilling Ops at Keddington Field

Egdon Commences Drilling Ops at Keddington Field

Monday, April 11, 2011
Egdon Resources plc

Egdon announced the start of drilling operations at the Keddington oil field on Lincolnshire License PEDL005(Remainder).

Egdon holds a 75% interest in and is operator of the PEDL005(Remainder) license. The joint venture partners are Terrain, holding a 15% interest and Alba, a wholly owned subsidiary of Nautical Petroleum, with a 10% interest.

The Keddington-4 well will be drilled as a re-entry and horizontal sidetrack from the Keddington-1Z "donor" well, which was drilled by Candecca Resources in 1998. This oil production well has been shut-in since the drilling of Keddington-3 and 3Z in April 2010. Keddington-4 is planned to penetrate approximately 200 meters of producing Unit 1 sandstone in a new horizontal section. The well is also planned to penetrate the deeper "Namurian" sandstones, which had gas indications in Keddington-3 to provide additional information on this potential gas bearing zone.

The British Drilling and Freezing Limited BDF28 drilling unit began mobilizing to the site on April 1, and operations began on April 4. The plugging-back of the existing well has been completed and the drilling of the sidetrack commenced at 0700 hours on April 9, from a kick-off depth of 2080 meters. The well is intended to be drilled directionally to a total measured depth of around 2750 meters. Drilling and completion operations are expected to last a total of around three weeks.

The well is expected to be completed for free-flowing or pumped production using the existing surface production facilities shortly after the rig is released from the site.

Keddington-4 is designed to increase total field production at a time of high oil prices and provide additional reservoir information in an untested part of the structure to factor into the investment decision on the scale of the gas to electricity generation project planned for the field. This is expected to provide an important additional revenue stream and eventually will enable unconstrained production of oil from the field.

Production from the adjacent Keddington-3z well has been suspended for safety reasons during the drilling operations and will resume once the rig has been demobilized from site and the flow characteristics of Keddington-4 has been determined.