Sterling Tests Positive Gas at East Breagh

Sterling's UK Assets
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Sterling Resources has successfully completed testing of the East Breagh well located in the UK Southern North Sea Block 42/13. Sterling holds a 45% interest and is the operator of the block.

The well was tested from the upper zone perforations 7490 feet measured depth (md) to 7560 feet md at controlled rates of up to 10.2 million standard cubic feet per day (mmscf/d). The final rate was held for a period of twelve hours prior to shutting in for pressure build up. The stabilized test was completed on a 32/64 inch choke setting at a flowing wellhead pressure (fwhp) of approximately 1630 pounds per square inch (psi) of pressure. A further rate increase was not attempted for operational reasons, but it should be noted that a calculated rate of 12.5 mmscf/d would be achievable at an fwhp of 1000 psi.

As originally reported October 3rd, a lower, poorer quality sand formation was also logged in the well. As part of the testing protocol this lower formation was perforated first from 7635feet md to 7746 feet md and tested at rates of up to 1.6 mmscf/d before adding perforations to the upper zone as above. This is the first time such a lower formation has been tested individually and in addition to proving the presence of gas, it provides further upside potential for stimulation in further wells.

Sterling's Vice President of Operations, John Rapach, stated, "We are pleased with these test results as the productivity from the upper formation is consistent with our expectations and the confirmation of the presence of
producible gas in the lower section is an added bonus for consideration in future wells."

Stewart Gibson, Chief Executive Officer of Sterling Resources, added, "This test confirms that the flow rate potential for a vertical well at Breagh is consistent with the estimates used for development planning. The next phase of drilling in the block will be the deviated West Breagh well, which will determine the potential flow rate for high angle wells. Drilling of West Breagh is anticipated to commence in late October."


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