Petroceltic Wraps Up Ops in Algeria

Petroceltic has completed logging and drilling of well AT-5 (pilot hole) on the Isarene permit in Algeria. Drilling began at the AT-5 well on January 9, 2011, and the well reached its total depth of 2049m on March 2, 2011, having experienced drilling delays due mainly to surface equipment failures on the contracted drilling rig.

Well AT-5 is being drilled to test a major "pop-up" feature in the north of the field and is located approximately 4 km east of the AT-1 well. The "pop-up" feature is one of many such structures typical of the northern part of the field and it is anticipated that these features are associated with high natural fracture density and thus potentially enhanced un-stimulated gas productivity. Mud losses while drilling, together with core, conventional logs and image logs from AT-5 all indicate the interval is potentially highly fractured with some of these being open natural fractures.

Logs at AT-5 showed the objective Ordovician reservoir to be fully gas bearing, and a gross gas column of 75.5 meters was logged, with no gas water contact seen in the well. The overall hydrocarbon pore volumes encountered at this location were significantly in excess of the pre-drilling prognosis. The well was cored with 29 meters of core being recovered from the objective reservoir section.

After completion of coring, drilling, logging and borehole image logging of the near vertical AT-5 pilot well, the well has now been side-tracked as originally planned (AT-5Z) and a horizontal section of up to 500 meters is currently being drilled to explore for high natural fracture density associated with a series of tectonic faults. The faults have been interpreted from 3D seismic data and the horizontal well is oriented to intersect fractures which are expected to be open.

Brian O'Cathain, Chief Executive of Petroceltic commented, "The results of well AT-5 are encouraging to date, the presence of natural fractures at this location augurs well for the test results, and the overall gas column logged was greater than expected at this location. We are looking forward to the AT-5Z well test results, now expected in May 2011."