Egdon Posts Initial Production Rates at Keddington

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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