The total area production is now in excess of 500 net equity barrels of oil equivalent per day. These volumes are being produced from the recent Morian 4 well on the Drews Landing field, and the older well stock on the New Ace field. The Morian 3 well is expected to be put back onstream shortly, and will add further production. Morian 5 well has now been spudded and is expected to be completed by end of April.
The recent successes in the area have also resulted in a further upgrade of gross field reserves from P1+P2 reserves of 5.4 mill barrels of oil equivalent (boe) as reported on the 27th of February, to P1+P2 reserves of 6.4 mill barrels of oil equivalent. These are gross field reserves (working interest). In future reserve reporting Rocksource will report on a net equity basis only. This is in line with the new SPE guidelines, which are currently in the consultation phase. These guidelines state that "royalty volumes" will be deducted from the reserves prior to reporting. The royalty is the share of reserves that the owners of the mineral rights are entitled to. As the Oslo Stock Exchange guidelines do not specify how to deal with royalty volumes the SPE guidelines are applied. Following these guidelines the net equity reserves are 4.9 mill boe.
Rocksource has established a production target to exceed 1,000 net equity barrels in 2007, and 2,000 net equity barrels within 2008.
Rocksource is currently evaluating alternative development strategies for the Drews Landing fields, and expect to initiate drilling of further wells during 2Q 2007.
Jacob Sannes, CEO of Rocksource's subsidiaries in the US, said:
"This reserves and production growth illustrates that it was a very good decision for Rocksource to enter into this area and invest in new wells. We will continue building the production from the current level and making this a high-value asset for Rocksource."
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