SAINT HELIER, Jersey, April 23,
2014 /PRNewswire/ --
Leveraging the lessons of the Koba-1 exploration well in
North Africa
LONGREACH OIL AND GAS LIMITED (TSXV: LOI) (the
"Company" or "Longreach") is about to drill into the
targeted Lower Liassic formation, the first prospective zone, with
the Company's second Moroccan exploration well - Kamar-1 - on the
Sidi Moktar onshore licence.
"We have set intermediate casing in Kamar-1 at approximately
1,960 metres of total vertical depth (TVD). Kamar-1 is a key
evaluation well that should add considerable knowledge to our
on-going assessment of the resource potential of the highly
prospective Kechoula structure located in our Sidi Moktar license
in the Essaouira Basin in Morocco.
As expected, our drilling team encountered increasing gas content
in the mud column as the Kamar-1 drill bit approached the Lower
Liassic formation. Given the results of our first Moroccan well
drilled in late 2013 into the Kechoula structure - Koba-1 - this
gas content increase in Kamar-1 was anticipated. Based upon our
detailed technical audit of the drilling of Koba-1, we have
modified our Lower Liassic drilling and evaluation program and have
the procedures in place at Kamar-1 to capture the necessary
petrophysical data that will help map our path to exploration
understanding and potential success. We expect to drill into and
log the Lower Liassic zone over the next few weeks," said
Dennis Sharp, Longreach's Executive
Chairman.
Methodically exploring Kechoula step-by-step
The Kamar-1 drilling and evaluation plan is to drill into the Lower
Liassic, but to stop short of intersecting the analogous depth
where Koba-1 encountered what, based upon technical data, the
Longreach team believes is a series of fractures and the source of
an influx of abnormally high-pressure water that interrupted the
collection of a full suite of reservoir measurements in the
Company's first well. At Kamar-1, Longreach plans to penetrate the
top of the formation, stop drilling to log and obtain gas samples
and side wall cores. By using this methodical approach, the team
plans to obtain data on natural gas saturations, gas composition,
formation pressures, reservoir porosity, gross and net pay
thickness and potential deliverability. This step-by-step
incremental approach is designed for Longreach to acquire the
petrophysical data that it was unable to gather in the Koba-1 well
and to verify the potential of the Kechoula structure.
Capitalizing on and leveraging the lessons of Koba-1
The Longreach technical team, led by Vice President of Exploration
Tom Feuchtwanger, is capitalizing on
the extensive technical knowledge acquired while drilling Koba-1,
which tapped the Lower Liassic formation and encountered an
estimated 45 metres of gas-charged sands. The Kamar-1 surface
location is about four kilometres southeast of Koba-1, and is
expected to intersect the Lower Liassic at a deeper (200 metres)
depth than at Koba-1. Longreach believes that proving the existence
of a quality reservoir and natural gas at this down-dip location
would make the large Kechoula inversion structure highly
prospective. This confirmation would form the foundation for an
extensive production testing program of Koba-1 and Kamar-1.
"We are following a disciplined, meticulous plan that continues
to improve our understanding of the Kechoula potential. Each well
is a technical building block to value creation. While there is
always anticipation of enormous success early in any exploration
program, extracting full value is a longer game that rewards
patience and learning from each well, log, evaluation and
interpretation," Sharp said.
Crafting exploration and reservoir evaluation success
The Longreach technical team employs a proven, four-step process to
creating sustainable, economic value from prospective reservoirs.
In management's view, successful exploration, development and value
creation is built upon: 1) understanding the reservoir, 2)
designing a recovery method that maximizes value, 3) implementing
cost-effective development and 4) generating sustainable netbacks
using sustainable practices. Longreach's Moroccan exploration is at
the early stages of this well-established methodology - a rigorous
process that has seen the Company's Canadian technical team
generate repeated economic success in a suite of companies across
the Western Canada Sedimentary Basin over the past three decades.
This accomplished record of commercial and technical success has
unlocked enormous value from diverse reservoirs producing a variety
of hydrocarbons ranging from high-pressure sour natural gas in
complex and fractured mountain geology to expansive bitumen
resources encased deep underground in sand. Longreach is deploying
parallel practices and procedures in pursuit of unlocking value
from the Kechoula structure.
About Longreach
Longreach is an independent Canadian oil and gas company focused on
its significant land position in Morocco. The Company has a 50% operated
interest in the Sidi Moktar license area covering 2,683 square
kilometres and is working closely with ONHYM as a committed
long-term partner to unlock the hydrocarbon potential of the
region. Morocco offers a
politically stable environment to work within and has favourable
fiscal terms to energy producers. Longreach is a public company
listed on the TSX Venture Exchange under the symbol "LOI".
Additional information about the Company can be found at
http://www.longreachoilandgas.com and under the Company's SEDAR
profile at http://www.sedar.com.
Special Note Regarding Forward Looking Statements
This press release contains forward-looking statements. Such
forward-looking statements relate to future events or the Company's
future performance. All statements other than statements of
historical fact are forward-looking statements. Forward-looking
statements are often, but not always, identified by the use of
words such as "may", "will", "should", "expect", "plan",
"anticipate", "believe", "estimate", "predict", "project",
"potential", "targeting", "intend", "could", "might", "continue" or
the negative of these terms or other similar terms. Forward-looking
statements in this press release include, but are not limited to,
statements regarding the drilling of the Karmar-1 well at the
Company's operated Sidi Moktar onshore license area in Morocco; the ability of the Company to
successfully complete the drilling program at Kamar-1 over the next
few weeks; the ability of the Company to avoid intersecting the
analogous depth where Koba-1 encountered technical issues in its
drilling program; the ability of the Company to successfully
penetrate the top of the formation, obtain gas samples and side
wall cores; the ability of the Company to successfully verify the
potential of the Kechoula structure; the ability of the Company to
intersect the Lower Liassic at a deeper depth than experienced at
Koba-1 and to confirm the prospective nature of Koba-1; and the
ability of Longreach to successfully employ the four-step process
of exploration methodology at Koba-1 and the Kechoula structure to
allow management to repeat the success enjoyed in the Western
Canada Sedimentary Basin. Forward-looking statements are only
predictions. Forward-looking statements involve known and unknown
risks, uncertainties and other factors that may cause actual
results or events to differ materially from those anticipated in
such forward-looking statements. Some of the risks and other
factors which could cause results to differ materially from those
expressed in the forward-looking statements contained in this press
release include, but are not limited to: general economic
conditions in Canada, the Kingdom
of Morocco and globally;
completing the proposed drilling program at Kamar-1 in a timely and
fiscally prudent manner; industry conditions, including
fluctuations in the price of oil and gas, governmental regulation
of the oil and gas industry, including environmental regulation;
fluctuation in foreign exchange or interest rates; risks inherent
in oil and gas operations; political risk, including geological,
technical, drilling and processing problems; unanticipated
operating events which could cause commencement of drilling and
production to be delayed; the need to obtain consents and approvals
from industry partners, regulatory authorities and other
third-parties; stock market volatility and market valuations;
competition for, among other things, capital, acquisitions of
reserves, undeveloped land and skilled personnel; incorrect
assessments of the value of acquisitions or resource estimates; any
future inability to obtain additional funding, when required, on
acceptable terms or at all; credit risk; changes in legislation;
any unanticipated disputes or deficiencies related to title
matters; dependence on management and key personnel; and risks
associated with operating in and being part of a joint venture.
Although the forward-looking statements contained in this press
release are based upon factors and assumptions which management of
the Company believes to be reasonable, the Company cannot assure
that actual results will be consistent with its expectations and
assumptions. Material factors and assumptions which management of
the Company has considered in connection with making the
forward-looking statements in this press release include that the
Company will be able to successfully complete the drilling program
at Kamar-1 and to successfully employ its process of exploration
methodology at Kamar-1 and the Kechoula structure. Undue reliance
should not be placed on the forward-looking statements contained in
this news release as there can be no assurance that the plans,
intentions or expectations upon which they are based will occur.
These statements speak only as of the date of this press release,
and the Company does not undertake any obligation to publicly
update or revise any forward-looking statements except as expressly
required by applicable securities laws.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in policies of the TSX Venture
Exchange) accepts responsibility for the adequacy or accuracy of
this release.
This news release does not constitute an offer to sell or a
solicitation of an offer to buy any securities of Longreach in any
jurisdiction in which such offer, solicitation or sale would be
unlawful. The securities referred to herein have not been and will
not be registered under the United States Securities Act of 1933
(the "U.S. Securities Act") or any state securities laws and may
not be offered or sold within the United
States or to U.S. Persons (as defined in the U.S. Securities
Act) unless registered under the U.S. Securities Act and applicable
state securities laws, or an exemption from such registration is
available.
For further information:
Martin Arch
Chief Financial Officer and Secretary
Tel: +44-203-137-7756