Tower Resources to Drill Uganda Well in 4Q

- Tower Resources to Drill Uganda Well in 4Q

Tuesday, August 23, 2011
Tower Resources plc

Tower Resources provided an operational update.

In Uganda, the high resolution aero gravity gradiometry survey over the Company's Exploration Area 5 was completed in June 2010 and the interpreted data clearly indicated an area expected to be favorable for the generation of hydrocarbons. It also highlighted a clearly defined structural high in the vicinity of the newly defined hydrocarbon kitchen.

This interpretation provided the basis for a focused 187 km 2D seismic program, which was completed on August 4, 2011 and the final data is being processed and interpreted. Once interpretation is complete, this high quality data will enable the choice of a suitable well location within the next month. Proposals from rig contractors and other service providers are being finalized and it is envisaged that a well can be drilled in the fourth quarter of 2011.

Offshore Namibia, in which the Company has a 15% carried interest in License 0010, the Company has been notified by Arcadia Expro Namibia, the operator and 85% interest holder, that it is continuing its farm-out process and is expecting farm in proposals shortly from a number of potentially interested international oil and gas companies ahead of drilling a well on the very large Delta structure. Tower Resources is working with its drilling consultants in order to ensure that the drilling program remains on track to spud a well as early as possible in the first half of 2012, currently anticipated in Spring.

Peter Kingston, Executive Chairman of Tower Resources, said, "With the recently acquired seismic data we should be in a position to spud a well in Uganda in the fourth quarter of this year. As Arcadia progresses its farm-out, the Tower Board continues to review the optimal route to maintain the Namibian project's schedule."

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Tower Updates Namibia Prospect Potential

- Tower Updates Namibia Prospect Potential

Thursday, June 30, 2011
Tower Resources

Tower Resources plc has provided details of the outcome of a second detailed technical and economic evaluation of the 0010 Licence, located offshore Namibia. Tower has a 15% working interest in the Licence and is fully carried financially by Arcadia Expro Namibia (PTY) Ltd (“Arcadia”) through an initial exploration well and a contingent second well.

The Tower Board has now received an updated Competent Persons Report, compiled by Oilfield International Limited (OIL), over Licence 0010. The CPR update follows the interpretation of the high quality 3D seismic data acquired in 2010 over the primary drilling target "Delta". OIL conducted a detailed review of the “Delta” structure and calculated the Expected Monetary Values (EMV’s) of the prospects and leads identified. OIL also updated the EMV of two other structures, ”Alpha” and “Gamma” which were the subject of the previously reported June 2010 CPR on Licence 0010.

The main conclusions of the CPR are summarised below.

The Delta Maastrichtian prospect remains the principal target for an exploration well. Best estimate prospective resources (50% probability) have been estimated as follows:

In the event of volatile oil, gross recoverable resources amount to 2.2 billion barrels and 3.4 trillion scft of natural gas. Net figures for Tower are 317 million barrels and 484 billion scft of natural gas.

In the event of gas condensate, gross recoverable resources amount to 267 million barrels and 8.1 trillion scft of natural gas. Net figures for Tower are 38 million barrels and 1.15 trillion scft natural gas.

In the event of dry gas, gross recoverable resources amount to 20 million barrels and 8.2 trillion scft natural gas. Net figures for Tower are 3 million barrels and 1.17 trillion scft natural gas.

Gross un-risked prospective recoverable resources from the Delta Palaeocene supplementary prospect and the other Licence wide supplementary leads at the 50% probability level amounts to about 10 billion barrels and 15 trillion scft of gas for the volatile oil cases and 35 trillion scft in the case of predominantly gas.

OIL has calculated for the Licence net risked prospective resources to Tower as 150 million barrels oil and 719 billion scft natural gas (together ca 270 million barrels oil equivalent). More importantly, the corresponding numbers for the target Delta Maastrichtian prospect alone are 55 million barrels oil and 257 billion scft of natural gas (together ca 98 million barrels oil equivalent).

OIL has calculated an EMV for the prospective resources of Tower and, in just the Delta Maastrichtian prospect, an EMV of US$744 million has been calculated. The Board believe there is also a very high upside in the other Delta horizons.

OIL has determined that there are now two prospects at Delta. The Maastrichtian prospect has been confirmed and the Palaeocene lead has been upgraded to a prospect. There are now three supplementary leads within the Delta structure: the Upper Campanian; the Campanian “wedge”; and at a deeper Albian horizon. The Alpha Palaeocene and Gamma Palaeocene leads are separate structures and would be the subject of further 3-D seismic before drilling.

OIL has used the seismic data, the two Namibian wells on the block and regional data to evaluate the likelihood that the reservoirs would be predominantly light oil-bearing; gas condensate-bearing or dry gas-bearing. For Delta, OIL concludes probabilities of 50%, 40%; and 10% respectively. The Gamma and Alpha structures are rated 45%, 44% and 11% respectively.

OIL have engineered the most likely development approach and associated capital cost, operating cost and production profiles for each case together with currently traded oil and gas prices (gas into Europe), escalated to 2020 first production and beyond. They have calculated NPV 10% after-tax values on that basis for each case. Each has been valued on an independent standalone basis to avoid trying to determine economies of shared facilities.

The final step has been to estimate a geological chance of success (“GCOS”) for each structure. DeltaM has been assessed as having a 40% GCOS and DeltaP a 24% GCOS. The leads have a GCOS ranging between 10 and 20%. An economic confidence factor has then been applied to the geological COS’s to calculate the economic COS “ECOS” which is used in the determination of risked reserves and the EMV calculations. DeltaM has a 31% ECOS; DeltaP a 19% ECOS; and the leads between 8% and 12%.

The OIL review team included two geophysicists, a geologist and a petroleum engineer having a total of 125 years of experience as technical specialists in the oil and gas industry. In particular, two of them have considerable experience of South America where South Atlantic exploration is most advanced. The OIL assessment has been undertaken in compliance with the SPE Petroleum Resources Management System (SPE-PRMS). OIL has had access to all available data from the Licence and a wide variety of regional technical information. They reviewed the work undertaken by Arcadia and specialist consultants and where relevant, undertook technical analysis of their own to accommodate their own wide and relevant experience, particularly of the Brazilian basins, and any publicly available information. Interaction with Arcadia took place to understand their technical approach but the conclusions drawn are entirely those of OIL.

The first exploration well, currently anticipated at the end of Q1 2012, will test as many as five zones of interest including two prospects and three leads targeting a “best estimate” resource potential of an estimated 6-12 billion barrels of recoverable oil equivalent (gross) depending on whether the fluid is predominantly gas or oil respectively.

Peter Kingston, Chairman of Tower Resources plc, commented: “The comprehensive independent reassessment of the prospectivity of Namibia Licence 0010 has confirmed its potential as a world class group of oil and gas prospects. It is particularly encouraging that the 3-D seismic survey has substantially increased the reserve potential of the Delta structure and has led to an improvement in the chance of success with the first well. This well alone, still on schedule for the end of Q1 2012, will test a resource potential of significantly more than 5 billion barrels of oil equivalent.”

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Tower Resources Spies Hydrocarbons in Namibia

- Tower Resources Spies Hydrocarbons in Namibia

Wednesday, May 18, 2011
Tower Resources plc

Tower announced its final results for the 12 months ended December 31, 2010.
Highlights:

• Namibia
  • Independent Competent Persons Report (CPR) in mid-2010 confirmed huge potential based on 2-D seismic
  • 3-D seismic survey interpretation has been completed since the year end and confirmed clear structural closure, sustained reservoir thickness and direct hydrocarbon indicators at the main Maastrichtian prospect level
  • A recently identified Albian age reservoir may be significant.
  • 3-D AVO interpretation fine tuning still in process but near completion
  • CPR update incorporating full 3-D interpretation underway and due for completion by end-June 2011
  • Financial and operational planning activities in progress with a view to drilling early in 2012
• Uganda
  • Prospectivity of EA5 has been enhanced by the results of an aero gravity gradiometry survey
  • A probable oil generation kitchen has been identified
  • A large high structural area has also been identified where reservoir quality may be productive
  • A seismic survey is ready to begin so that a well can be drilled before the end of 2011

Commenting on the results, Peter Kingston, Executive Chairman of Tower said, "The 3-D seismic data acquired in Namibia has confirmed the exciting potential in the Delta Maastrichtian reservoir with very strong hydrocarbon indications being seen. A second potentially significant reservoir has been identified in a formation of Albian age and the secondary leads have been confirmed to be present. A well early in 2012 will finally test one of the world-class, multi-billion barrel resource potential prospects in the Company's Namibian License. While Namibia can transform Tower as a company, I am pleased that Uganda may still deliver substantial shareholder value from a well in the second half of this year. The next year promises to be one of the most exciting of my professional career."

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Tower Resources Notes Seismic Ops in Namibia, Uganda Licenses

Tower Resources Notes Seismic Ops in Namibia, Uganda Licenses

Wednesday, April 13, 2011
Tower Resources plc

Tower Resources provided an update on its current operations in each country, managed by wholly-owned subsidiaries Neptune Petroleum (Namibia) Limited and Neptune Petroleum (Uganda) Limited.
Namibia

In License 0010, offshore Namibia, where Neptune Petroleum (Namibia) Limited has a 15% carried interest, interpretation of the 3-D seismic is well advanced with initial conclusions delivered from all of the specialist consultants. Clear structural closure, sustained reservoir thickness and direct hydrocarbon indicators - AVO anomalies and pock marks - have been confirmed at the main Maastrichtian prospect level. Additional potential is confirmed at the Palaeocene horizon (defined as a lead in the Competent Persons Report (CPR)) but also at two other formations deeper than the Maastrichtian. The very large structural closures are confirmed and, therefore, the indicated additional reservoir horizons substantially increase the resource upside potential.

Arcadia Petroleum Limited, operator of License 0010, which is funding Tower for the cost of the first well, is making progress with its program to put in place funding and to contract a deep water drilling rig with a view to drilling around the end of 2011. At present, there appear to be suitable rigs available during the target period. A CPR is currently being updated with a targeted publication early in June 2011.
Uganda

A letter of intent in advance of a contract for the 2-D seismic program of 150-200 kms has been signed with TESLA-IMC International Limited and line clearance is expected to begin by late April. Completion is targeted for end June 2011, by which time a well location can be selected. A high density geochemical survey, conducted by GORE Geochemical Surveys, is also underway over the prospect area together with focused sampling around the two existing wells and an oil-bearing well in EA1. The Environmental Impact Assessment and early operational planning for a third well have begun. Now that the political uncertainty with respect to long term development planning in Uganda appears to have been resolved, a final phase of the farm out program has been initiated. The Tower Board has raised the additional equity capital required to undertake the seismic program on schedule and a well can still be drilled in October 2011, subject to rig availability. If the cost of seismic is subsequently met by a third party, the funds will be deployed on new projects.

Peter Kingston, Executive Chairman of Tower Resources, commented, "I am pleased to confirm that the first well in Namibia, to test the huge potential of the Delta prospect, remains a target within a year. The 3-D seismic interpretation has confirmed the 2-D seismic interpretation but has also opened up significant potential from additional reservoirs. I am also pleased that the Uganda seismic and well program is still on schedule."