Bula Resources - Drilling Report
July 01 1997 - 7:18AM
UK Regulatory
RNS No 7765e
BULA RESOURCES (HOLDINGS) PLC
1st July 1997
Bula Resources (Holdings) plc (Bula)
Bula announces details regarding its Libyan activities.
Over the past three years Bula has been actively seeking prime
exploration and production acreage in Libya, a country with a highly
developed oil and gas sector which is largely underexplored and
which provides the potential for the discovery of significant
additional oil and gas reserves.
In August 1996, Bula announced that it had agreed an Exploration and
Production Sharing Agreement (EPSA) with the National Oil
Corporation of Libya (NOC) covering blocks in the Sirte and Ghadames
basins. Bula has negotiated a farmout agreement with a major
international Canadian oil corporation to join Bula in exploring for
hydrocarbons on these blocks. As a result of the farmout, which
becomes effective on the ratification of the EPSA, the Canadian
corporation shall carry Bula's costs for the entire exploration
phase and provide finance for the development programme for this
area of massive potential. The work programme involves the
acquisition of new seismic and the drilling of several wells.
With regard to the EPSA for the G and U blocks there have been
extensive ongoing negotiations and discussions between the Libyan
authorities, Bula and the Canadian corporation, which would become
the operator under the terms of the current farmout agreement with
Bula. This has resulted in the EPSA reaching the stage where it is
being considered for final regulatory approval.
This EPSA incorporates two blocks; the G block in the Ghadames basin
and the U block in the Sirte basin.
G Block
The G block is a highly prospective exploration block located in
western Libya close to the Tunisian and Algerian borders. As a
result of previous drilling there are numerous shows and two oil
accumulations within the block. This area is close to analogous
Algerian production located to the west of the G block. The block
contains multiple reservoir targets and good reservoir quality has
already between established in the basin.
Plans have been announced for the construction of oil and gas
pipelines that will run through the block from the Al Waffa
Oil/Gas/Condensate Field, located 70 km to the south of the G block,
to the Mediterranean coastline. This pipeline will then supply the
European gas grid via the planned interconnector from Libya to
Italy.
U Block
The U block is a highly prospective exploration block. It lies at
the end of a trend of large reefal oilfields. Maps indicate that the
conditions necessary for reef building extend through the block and
that reef-like structures are present in this block. Within these
structures there are at least three prospective horizons. Any
potential development in this block could utilise the intensive
pipeline infrastructure which surrounds the U block.
CC Block
Bula has also reached agreement with a major integrated Central
European oil company to apply for additional prime acreage in Libya.
Negotiations with the NOC for an EPSA, which are ongoing, are
expected to conclude shortly.
The principal area included in this proposed EPSA is the CC block in
the Sirte basin which contains the Chadar Oil/Gas/Condensate Field.
Two successful appraisal wells drilled into the field have proved
that the structure contains significant proven reserves. After
completing an initial study it is anticipated that production from
these proven reserves will be rapidly achieved.
Other parts of the CC block are highly prospective with two proven
gas/condensate structures within the block, an oil/gas discovery
extending into the block and an oil prospect extending into the
block.
A number of other exploration blocks are also to be included in the
EPSA which is being negotiated for the CC block.
Bula is also reviewing and evaluating other areas of interest in
Libya and we anticipate that further applications will be submitted
by Bula in respect of those areas which we believe have the
potential for successful exploration and exploitation of oil and gas
reserves.
For further information please contact:
James Morrissey
Murray Consultants
Telephone (353-1) 6614666
Issued: 1 July, 1997
END