Drilling to Commence at Cadogan's Ukraine Field

Cadogan announced the following update on the ongoing drilling and well testing program on the Pokrovska and Zagoryanska gas fields in eastern Ukraine.

The Pokrovska 1 well was deepened to 5,762.5 meters into the Lower Visean V26 interval where logging of the V26 indicated it to be water bearing. As a result the zone was plugged off to enable testing of the overlying V24/V25 interval, which log data indicates is gas bearing. The equipment required to undertake a full well test on Pokrovska 1 will be moved into location during October in order to comprehensively evaluate the V24/V25 interval. The Saipem drilling rig has been moved on to the Pokrovska 2a location, where drilling is planned to commence this month. The primary objective for this well is the Upper Visean section in a different part of the Pokrovska license.

On the Zagoryanska license, a work over rig has completed the intervention program at the Zagoryanska 1 well and is now being moved to the Zagoryanska 2 well location to carry out further work over operations. At Zagoryanska 1, testing of the secondary target V23/V24 proved to be non-productive. The well was recompleted in the primary V18/V19 target and perforated. A coiled tubing unit is being mobilized to Zagoryanska 1 to continue the testing program on the V18/V19 interval. This interval is currently producing at the Zagoryanska 3 well, located about 800 meters from Zagoryanska 1.

An extensive work over and testing program on the other wells on the Zagoryanska license will continue into 2012. In addition, the work program includes a new well, Zagoryanska 9, which is targeted at the upper and lower Visean section.

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