Rift Rides High on Successful Net Gas Pay at Puk Puk-1

Rift Oil plc has reported that Puk Puk 1, located in Papua New Guinea, has now reached Target Depth and has been successful beyond the Company's most optimistic expectations with net gas pay about twice that seen at Douglas and about 50% greater than expected.

Puk Puk-1 has reached Total Depth at 1,999 meters, after encountering granitic basement at 1,983 meters. Electric logs are high quality and indicate a gross gas column of 159 metres from 1,820-1,979 meters (48.5 meters net) within good quality Toro, Upper Hedinia and Lower Hedinia sandstone reservoirs. Each zone lies on a slightly different pressure gradient, but all are consistent with oil condensate bearing gas in reservoir; and downhole sampling has recovered oil condensate. As indicated in earlier releases, Puk Puk-1 has come in 150 meters high to prognosis and 50 meters higher than our previous discovery at Douglas-1. Net gas pay is more than twice that seen at Douglas and about 50% greater than expected. Oil condensate yields also appear likely to be higher than at Douglas-1.

Although the logs do not indicate moveable oil at this location, oil shows were encountered during drilling of the Lower Hedinia, which may indicate presence of oil lower on the structure and elsewhere in the license.

The Company's forward plan is to confirm the net pay estimates; remap the Puk-Puk-1 structure and to flow test the well, probably over several zones, in order to ascertain gas deliverables and precise oil condensate yields. This program will take several more weeks to complete, at the end of which we expect to be able to quantify the additional amount of reserves that Puk Puk-1 has added to the license.

Ian Gowrie-Smith, Chairman, commented, "The encouraging results from Puk Puk are likely to have taken us a significant further step towards achieving a commercial threshold of reserves on our Foreland Basin acreage. The potential size of this discovery makes fulfillment of the supply stipulation of 800 bcf in the Alcan memorandum of understanding, or an amount that could justify floating liquifaction with FLEX LNG, an ever closer possibility. The indications of substantial quantities of oil condensate could make the economics of extraction much more attractive. Also encouraging are the oil shows given that there remains 7,000 sq km of concessions adjoining the Puk Puk discovery unexplored."