Rocksource to Progress to Drilling on AGC Profond

Source: www.gulfoilandgas.com 7/20/2009, Location: Africa

Rocksource AGC (Profond) AS (“Rocksource”), a wholly owned subsidiary of Rocksource ASA, has elected to proceed, under the terms of a Farmout Agreement dated 8th September 2008 with Ophir Energy plc, to enter into the Second Exploration Phase of the AGC Profond Production Sharing Contract (PSC).

The Second Exploration Phase brings a commitment to drill one exploratory deepwater well, which is anticipated in Q3 of 2010. The well is expected to target the ‘Cheval North’ prospect, which is estimated to contain a mean resource of 429 mmboe (107 mmboe net to Rocksource on the assumption that further rights to acquire up to a 25 per cent participating interest (being a 28.409 per cent paying interest) are exercised). Rocksource estimates the chance of success for the well targeting this prospect to be over 50 per cent.

The AGC Profond PSC covers a large tranche of the deepwater area (9,838 sq km) off the West African coast of Senegal and Guinea Bissau.

Rocksource CEO Trygve Pedersen commented; “I am very pleased to announce that we have chosen to enter into a drilling obligation on AGC Profond based on the encouraging results from our CSEM data testing. The Cheval North prospect is a very valuable addition to our existing low risk, high potential portfolio. We have the opportunity to test a world class CSEM positive prospect in 2010 and have significant follow up potential if the initial well proves successful.”

Rocksource has now completed the initial obligation made to Ophir under the staged farm-in agreement announced in the stock exchange notice on the 8th September 2008. The company has successfully acquired, processed and interpreted CSEM data testing four prospects lying within the AGC PSC. The results of the surveys are positive and based upon this the company will now proceed to drilling.

The PSC area contains multiple play intervals and currently has 16 prospects mapped within its limits. These represent a potential unrisked resource of approximately 1.7 Bboe. The CSEM evaluation targeted four of these prospects and a gross unrisked resource totaling 1.1 Bboe. The results of the survey have shown that three of the initial four prospects are associated with robust and significant resistivity anomalies which have been interpreted by Rocksource to be likely caused by hydrocarbons. These CSEM positive prospects represent potential resources of 942 mmboe.

Additionally, a new prospect has also been identified on the basis of the CSEM evaluation. This stratigraphic trap, on the flank of the ‘Cheval North’ prospect, has an estimated mean resource size of 202 mmboe and could be developed in tandem with any Cheval North discovery. The overall potential risked resource for the PSC, net to Rocksource, is estimated at 145 mmboe.

Initial well planning is in progress and preliminary well locations targeting the Cheval North prospect have been evaluated. The Rocksource financial commitment for this well is currently estimated at $12.5mm and will be subject to amendment as plans mature further.

This contribution to the first well-cost marks the second stage in the farm-in agreement between the two companies and will earn Rocksource a total of 15 per cent equity in the PSC. To earn the full 25 per cent equity in the PSC Rocksource will be required to make a similar contribution should it choose to enter into the second exploration well.


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