Urals Moves Forward with Dulisma Development

In line with the Dulisma field development plan in Eastern Siberia, Urals Energy has awarded contracts totaling almost U.S. $60 million for the construction of the first stage of the Central Processing Facilities, infield gathering system and export pipeline system which are scheduled for completion by end of 2008.

Urals Energy intends to tie-in to Transneft's East Siberia to Pacific Ocean (ESPO) pipeline in accordance with previous approvals. Consequently, all of the 273 mm diameter linepipe has been procured and is in the process of being distributed to the pipeline route. In addition, long lead equipment for the CPF is currently being delivered to the Dulisma field.

By the end of April, Urals Energy expects delivery of its second new drilling rig from China, and at the same time the company also expects to have results from the first new horizontal development well which is now being drilled with the existing drilling rig.

Production is currently running at 800 bopd from existing wells. Dulisma, as estimated by DeGolyer and MacNaughton, contains 464 mmboe of 2P reserves and is anticipated to reach production of 30,000 bopd by 2011. Oil from the field is expected to flow into the ESPO in H1 2009.


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