Victoria Oil & Gas Logs Pay at Well 103 at West Medvezhye Project, Russia

Victoria Oil & Gas

Victoria Oil & Gas announces the results of petrophysical interpretation based on the open-hole logging at Well 103 at its West Medvezhye gas and condensate project in Russia.

The well was drilled to a total depth of 3,900 meters and open-hole logs were obtained with petrophysical interpretations generated by the Company's technical team, Baker Atlas and Krasnoyarskgeophysika.

The log data obtained from the wellbore and subsequent interpretation has yielded the following results:

--Interval 3,730 - 3,737 meters: hydrocarbon-bearing sands were observed in the Bazhenov horizon with hydrocarbon saturation of 50% and porosity of 11%.

--Interval 3,794 - 3,799 meters: hydrocarbon-bearing sands were observed in the Jurassic (J2) horizon with hydrocarbon saturation of 75% and porosity of 15%.

--Interval 3,812 - 3,817 meters: hydrocarbon-bearing sands were observed in the J2 horizon with hydrocarbon saturation of 75% and porosity of 17%.

The logs give a strong indication of the presence of gas or gas condensate, however, the Company cannot rule out the possibility of independent oil accumulations as several wells in nearby license areas have produced crude oil from the J2 horizon. The horizons indicating hydrocarbon shows are either within or close to the Bazhenov shale. This is the source rock for the Nadym-Pur hydrocarbon province, which hosts some of the largest gas and gas condensate fields in the world.

On the basis of these results, casing will be set to a depth of 3,880 meters and mobilization will begin for testing to determine reservoir productivity, characteristics and reserve volume size. This testing will take place for a minimum period of 90 to 120 days and the Company anticipates commencement before the end of the year.

The Company will also be using the subsurface data gathered from this well to refine its interpretation of its existing seismic data. This will remove some of the uncertainty inherent in the identification and selection of the targets for the further exploration of the license area.

Commenting today, Managing Director William Kelleher said, 'Today's results are extremely important for Victoria as they confirm the presence of hydrocarbons at Well 103 in over 55 feet of net pay sands. These same intervals produce from adjacent wells in nearby license areas and the subsurface data we have obtained will greatly enhance our analysis of the new exploration targets to be drilled this winter. Presently the well is stable, in good condition and will be cased prior to extensive testing to confirm the nature and overall size of each accumulation as well as potential productivity.'