Dover Announces Preliminary Results from Egyptian Well
Dover Petroleum's preliminary results from its first well in the East Wadi Araba Concession Agreement are promising.
Drilling of the EWA-2X target well has reached 5198 feet (1584 meters) in total depth which is interpreted to be the basement. Initial electric logging over the interval 1,400 through 4,000 feet (427-1219 meters) has indicated two promising oil zones. The upper zone with a top at a depth of 1,700 feet (521 meters) occurs in fractured dolomites of the Middle Miocene Kareem Formation and is some 77 feet in thickness (23.5m). Provisional porosity determinations average 12%. A deeper second potential oil zone occurs in dolomitic limestone of the Eocene Thebes Formation with a top at 2,810 feet (856meters). This zone extends over a thickness of 360 feet (128 meters) and electric logs indicated a cumulative 92 feet (28 meter) of potential oil pay within this zone. Provisional porosity determinations average 10%. Due to the highly fractured and porous nature of the Thebes Formation, circulation losses occurred while drilling this interval. These losses meant that drill cuttings and possible oil shows were not available while drilling below this point. It also has meant that well logging under difficult conditions (TLC) has taken longer. Electric logging continues in the lower section of the well where two major oil target horizons, the sandstones of the Matullah and the Nubia have been drilled. These sands have proved to be very important reservoirs in many Gulf of Suez fields. Results from electric logging of the lower section of the well are expected to be released after the electric logging has been completed.
The current cumulative thickness of oil zones of 169 feet (51.5 meters) and any additional oil zones, which may be logged in the sandstone targets, must be drill stem tested (DST) to establish reservoir properties, and to determine if commercial flow rates can be achieved. These tests will also provide information on oil quality and some indication of possible reserves. Testing will be carried out immediately after logging and casing of the well which is expected to occur in the next few days.
It is particularly important to understand that the identification of Promising oil zones does not mean that drilling has resulted in a producing Oil well or that a commercially viable deposit of oil has been discovered. These matters will be further understood after receipt of the results of drill Stem testing.
It is, likewise, important to understand that even if a commercially viable deposit of oil is discovered, substantial additional capital will be required in order to bring such oil into production and no assurance can be provided that such capital will be available.
The Company also announced that it has agreed to extend the exercise termination date from December 20, 2002 to January 20, 2003 for certain warrants issued by the Company, which warrants, if exercised, would permit the holders thereof to acquire 13,000,000 shares of the Company's common stock at a price of $.80 per share. Any shares issued upon exercise of the warrants will be restricted securities.