Logging Ops Underway at Transeuro's Karlavskoye Field

Transeuro has successfully drilled to the logging depth of 3,507 meters in the 'C16' Cretaceous interval. Logging operations are now ongoing to acquire the standard set of wireline logs, plus a log to identify the location and orientation of natural fractures in the rock, and finally a pressure tool to confirm the reservoir pressures that will also be used to identify the thickness (vertical height) of the gas columns in the wellbore. Logging operations are expected to last less than a week.

The 51-101 compliant resources estimates for the Karlavskoye field, in Ukraine, prepared by Fekete Associates suggest nearly 0.5 Tcf (Trillion cubic feet) of gas in place (discovered resources) with additional condensate (offset well data suggests a yield in the range of 40-60 barrels per million cubic feet of gas at these depths).

The Fekete report assumes a gas column thickness of 70 meters combined from the 6 main 'Cretaceous intervals' (the Turonian, C12, C13, C14, C15 and C16). Determining the thickness of the overall gas column is one of the key objectives of the Karl-101 well and has the possibility to significantly impact the volume of gas in place, together with the average porosity derived from the standard logs.

Based on the drilling data obtained to date, the Company has identified 4 'gas zones' with different pressures within the Cretaceous intervals, and 12 potential 'reservoir sections' within these gas zones. The wire line logs will define which of these reservoir sections will be perforated during testing operations and how many separate tests will be performed over the coming weeks. Each individual test is expected to take around 2 weeks with potentially 3 to 5 test required overall, lasting up to 2 months.