Oilex Encounters Dry Zones at Lolotoe-1

The operator, Oilex, has advised that the log evaluation of the primary objective Elang/Plover Formation sandstones in the Lolotoe-1 well indicates that no commercial hydrocarbon zones are present. The zones where shows were recorded in the Flamingo
Formation are also not commercial. On completion of well operations the Songa Mercur drilling rig will be demobilized to Singapore.

The Lolotoe-1 well data will be integrated into the existing studies to assess the implications on the regional prospectivity of the southern part of the JPDA 06-103 contract area. The Joint Venture will then decide on locations for further wells planned to be drilled later in 2010 to evaluate the remaining potential in the contract area.

There remains over 20 further prospects in the JPDA 06-103 contract area with the potential to host significant oil reserves. Most of these prospects are located to the north of, and have different geological characteristics in varying degrees, to the structures drilled by Lore-1 and Lolotoe-1 wells which were the two easternmost of the prospects identified in the southern part of the contract area. The contract area is located near to a number of existing producing fields further to the west as well as Eni's Kitan oil discovery.

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