Leni Reinstates Production at Hontomin Well

- Leni Reinstates Production at Hontomin Well

Thursday, August 04, 2011
Leni Gas & Oil plc

Leni Gas announced the reinstatement of production at the Hontomin-2 well in Northern Spain, and its immediate plans for further production enhancement at the Ayoluengo Field.

During the last few weeks, operations at Hontomin have focused on cleaning the well and the perforating of an additional reservoir zone shallower than the previously producing interval. These operations were successfully concluded and the well was returned to production on the evening of the July 29, 2011.

A total of 13.5 meters of perforations were opened between 1349.5 and 1365 meters including 7.5 meters in new reservoir zones which were identified on wireline logs run earlier in July. The well continues to clean-up with water cut reducing and oil production increasing. The well is producing approximately 180 bfpd and the water cut has been falling over the last 4 days. During the last 24 hour period the well produced 15 barrels of oil and production is expected to continue to rise significantly as the static fluid level in the well is reduced and the new perforations contribute to oil flow. In October 2010, Hontomin-2 reached a production rate of over 85 bopd which was achieved without the 7.5 meters of newly opened perforations.

The Company-owned Cardwell rig has now been returned from Hontomin to the main Ayoluengo field 30 kilometres away where several wells from the recent well intervention program will be returned to production. Wells Ayo-22 and Ayo-32 are expected to be brought back on production within the next few weeks. Further routine maintenance work to other producing wells, including Ayo-18 and Ayo-40, also requiring the use of the Company's Cardwell service rig, will be undertaken and this is expected to lead to further improvements in overall production rates which have been performing as expected.

Design work for chemical stimulation in order to treat the scale and wax found in wells during the recent work-overs and further enhance production is progressing and field trials are planned for the autumn.

Neil Ritson, LGO's Chief Executive, commented, "Hontomin-2 is an important well and we firmly expect further improvements in production as it cleans up. The return of the rig to Ayoluengo will allow us to consolidate the gains made during the recent interventions and therefore production from Spain is expected to exceed 400 bopd in the next few months. We are happy with the recent progress made in Spain and intend to update shareholders on further developments as soon as possible."

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Leni Farms-In Trinidad Leases

- Leni Farms-In Trinidad Leases

Monday, July 25, 2011
Leni Gas & Oil plc

Leni Gas & Oil announced an agreement to farm-in to the Advance Oil Company (Trinidad) Limited ("Advance") North Moruga area leases. LGO plans to work-over existing producing wells and drill up to nine (9) new wells on the leases.

The Heads of Agreement with Advance sets out the framework for a full farm-in agreement and joint operating agreement by which LGO will:

• take over operatorship of the Advance leases,
• reactivate production from the existing wells on the leases,
• drill a minimum of three (3) exploration and up to six (6) development wells,
• obtain an immediate 33% interest in net production revenues,
• on conclusion of the farm-in work program, and depending on the number of wells drilled, earn between 33% and 49% interest in the Advance leases.

A signature bonus of TT$250,000 (US $39,000) has been paid to Advance and gives LGO exclusivity to conclude the definitive agreements and assignment of interests envisaged under the Heads of Agreement.

Advance, have held the North Moruga leases for a number of years, during which they have integrated all existing geological and production data and have already drilled three (3) exploration wells. Importantly, they have also acquired the environmental baseline data necessary to facilitate the permitting of further new wells. The leases cover an area of 1,223 acres and lie less than 5 kilometers east of the West Moruga Field which has produced 25 mmbbls of oil and 3.5 kilometers west of the Innis, Antilles and Trinity Fields which have produced approximately 15 mmbbls of oil.

Short-term production potential from the existing wells is estimated to be of the order of 120 bopd and LGO has agreed to spend up to TT$300,000 (US $47,000) during 2011 to raise the production to at least that level.

The definitive agreements require approval and a formal assignment of interests by the Trinidad and Tobago Ministry of Energy and Energy Affairs. These agreements are anticipated to take up to 90 days to obtain. The first new well will be drilled as soon as practical after interest assignment, likely to be in late 2011.

Neil Ritson, Chief Executive Officer commented, "This is the first of a number of new opportunities that LGO is negotiating in Trinidad as we seek to significantly increase our operations there. The Advance leases lie in a highly prospective, but under-explored, part of the Southern Basin and the combination of existing proven reserves and several undrilled structures is especially attractive."

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Production Resumed at Leni's Eugene Platform

- Production Resumed at Leni's Eugene Platform

Thursday, June 09, 2011
Leni Gas & Oil plc

Leni Gas & Oil announced resumption of production from the Eugene Island-184 ("EI-184") platform in the Gulf of Mexico.

Production operations were resumed safely on June 3, 2011 at the EI-184 facilities following the transfer of operatorship to Marlin Energy LLP ("Marlin") as previously announced in late May. All previously active wells (A1, A3, A4, A5 and A8) were returned to production and operational reporting to the Joint Venture partners has now been resumed.

During the initial five day ramp up period; gross physical production has averaged 1,199 mcfpd and 402 bopd (609 boepd). Once downtime is accounted for, this equates to an average daily rate of approximately 922 boepd. LGO holds a 7.25% working interest in the EI-184 field.

Early indications are that production has been re-established at higher than pre-shut down levels, however, stabilized rates are not yet available and some flush production after a 60 day shut-in period would be expected.

Neil Ritson, LGO's Chief Executive, commented, "We are pleased that production and revenue has been restored so quickly and that all the wells have come back on-line after the shut-down. We now look forward to working with the new operator to plan for sidetracking and recompleting wells in the field to increase production."

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Leni Updates Workover Ops at Spanish Wells

- Leni Updates Workover Ops at Spanish Wells

Thursday, May 26, 2011
Leni Gas & Oil plc

Leni announced further details of the well work-over operations being performed at its 100% owned Ayoluengo and Hontomin Oilfields in Northern Spain.

As planned, Société de Maintenance Pétrolière ("SMP") and Services Pétrolièrs Schlumberger ("Schlumberger") were mobilized to the field in the week of April 26, 2011. The SMP-2 rig and the Schlumberger wireline unit have been used in tandem with the Company-owned Cardwell work-over rig to advance work on two wells simultaneously.

As previously announced in March, the work program is focused on six high productivity wells in the central area of the Ayoluengo Field (Ayo-4, 5, 32, 36, 37and 46) and will additionally include the perforation of approximately 40 meters of previously untapped reservoir in the Hontomin-2 well on the nearby Hontomin Field.

To date, wells Ayo-4, Ayo-5 and Ayo-32 have been logged. Wells Ayo-4 and 5 have been perforated and both have been recompleted for production. In well Ayo-4 a total of 23.7 meters of new perforations were added and 25.2 meters of existing open perforations re-perforated. In well Ayo-5 new and repeat perforations were 16.9 and 19.9 meters respectively. Re-perforation is intended to help remove scale build-up and increase the area of contact between the reservoir and the well bore.

Wells Ayo-4 and 5 have been returned to production and the completion of Ayo-32 is expected to be concluded within a week. Well Ayo-5 continues to clean up, stable flow rates have not yet been measured, however, based on the electric logs run in the well it is believed that additional production capacity will be achieved over the next few weeks. Well Ayo-4 was placed back on production on the 25 May 2011 and production data is not yet available.

The SMP-2 rig has now been moved to well Ayo-37 and operations are underway with 5 meters of new perforations and at least 28 meters of re-perforating planned. Additionally, an electric down-hole submersible pump will be installed in well Ayo-37 when logging and perforation operations have been completed. The CPS Cardwell rig will shortly be moved to Hontomin-2 to prepare the well for perforating.

Neil Ritson, LGO Chief Executive commented, "We are very happy with our progress so far and remain on time and budget with about 45% of the program completed. It is too early to predict the production impact of the work, however, the amount of previously untested net pay we have been able to access is slightly more than was estimated in the initial plan."

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Leni Briefs Final Details for Spanish Work-Over Ops

Leni Briefs Final Details for Spanish Work-Over Ops

Wednesday, April 13, 2011
Leni Gas & Oil plc

Leni announced final details regarding its planned work-over operations at its 100% owned Ayoluengo and Hontomin Oilfields in Northern Spain.

The Company's Spanish subsidiary Compania Petrolifera de Sedano S.L. has signed contracts and agreed work scopes with both the Société de Maintenance Pétrolière ("SMP") and Services Pétrolièrs Schlumberger ("Schlumberger"). The Company has also received all outstanding permits and authorizations from the Spanish authorities in order to commence the planned work-over program announced on March 17, 2011.

Schlumberger will provide all necessary wireline logging and perforating services, as well as cementing services if required, and SMP will supply their 80-tonne "SMP-2" drilling unit which will be used in conjunction with the Company owned Cardwell 45-tonne rig to ensure overall smooth operations. Mobilization to the field will commence shortly and the program is expected to get underway on April 26, 2011.

As announced in March, work will initially focus on six high productivity wells in the crestal area of the Ayoluengo Field (Ayo-4, 5, 32, 36, 37and 46) and the perforation of approximately 45 meters of previously untapped reservoir in the Hontomin-2 well on the nearby Hontomin Field. Each Ayoluengo well will be cleaned out, re-perforated over existing intervals, some new intervals will be perforated and the casing and production tubulars will be repaired. Additional cementing operations will be selectively undertaken to improve water shut-off where this is required. A progressive cavitation pump (PCP) will be installed in well Ayo-37 to increase the production and reliability of that well. Depending on initial results up to four additional wells (Ayo-18, 35, 38 and 44) may be added to the program at Ayoluengo.

The estimated production capacity from the work-over program ranges from 300 to over 500 barrels oil per day. The initial seven well program is expected to be completed within 60 days.

Neil Ritson, LGO Chief Executive commented, "We are very pleased to be undertaking this work which will immediately benefit both the production levels and cash flow from our Spanish operations. This is of course especially beneficial at a time of high oil prices. Successful results from this initial program will lead to further investment in the field facilities and the completion of additional wells."