The Globe and Mail

Go to the Globe and Mail homepage

Jump to main navigationJump to main content

Globe Investor

News Sources

Take control of your investments with the latest investing news and analysis

Press release from CNW Group

Sterling Resources Enters into Contract to Drill Two Wells Offshore Romania and Updates its Romanian Prospective Resources

Thursday, May 31, 2012

Sterling Resources Enters into Contract to Drill Two Wells Offshore Romania and Updates its Romanian Prospective Resources02:00 EDT Thursday, May 31, 2012CALGARY, May 31, 2012 /CNW/ - Sterling Resources Ltd. (TSX-V: SLG) ("Sterling" or the "Company") is pleased to announce that its wholly owned subsidiary in Romania, Midia Resources SRL ("Midia"), has entered into a contract with Grup Servicii Petroliere SA ("GSP") for the drilling of offshore exploration wells "Ioana" in Block XV Midia and "Eugenia" in Block XIII Pelican.  In addition, Sterling is pleased to provide updated Prospective Resources for additional offshore prospects.Midia, on behalf of Sterling and its approved joint venture partners Petro Ventures Europe BV ("Petro Ventures") and Gas Plus International BV ("Gas Plus"), has contracted the cantilever-type jack-up drilling rig "GSP Jupiter" for the drilling of the two back-to-back wells likely to commence mid to late September upon completion of TPAO's program offshore Turkey.  The program calls for the drilling of Ioana in 93 metres water depth to target the Mid Pontian sandstone formation to a total anticipated depth of 1,600 metres.  Following the drilling of Ioana, the rig will be remobilized north for the drilling of Eugenia in 55 metres water depth to target three formations in the Oligocene, Eocene and Late Cretaceous to a total anticipated depth of 2,300 metres."The drilling of Ioana and Eugenia re-establishes the joint ventures efforts, following amicable resolution with the state of Romania, proactively to explore this highly prospective concession.  Success at Ioana could greatly enhance Sterling's goal to establish a more substantial gas hub in the Midia block that already includes the Ana and Doina discoveries.  Eugenia, on the other hand, represents the first exploration well to be drilled in the Pelican block," stated Mark Beacom, Sterling's Vice President and General Manager for Romania.Sterling is the operator of the Midia and Pelican blocks in offshore Romania and holds a 65 percent working interest.Further to our 2011 year-end evaluation of the Offshore Romanian assets, RPS Energy has completed an evaluation of several newly identified prospects within the Pelican and Midia blocks, which represents a significant addition to our Romanian exploration portfolio.Following the discovery of gas by Exxon/OMV Petrom with the Domino-1 well some 35 km southeast of the Midia block, three exciting prospects have been identified and evaluated.  The Anca, Maria and Nadia prospects, which are in water depths of between 100 and 120 metres, are believed by Sterling to be in similar formations to the Domino-1 well discovery.  In addition the Paula and Voinicul (updip) prospects have been mapped in the shallow water part of the Midia block. Unrisked(1) Prospective Resources (Bscf)as at May 31, 2012Company Share LowEstimateBestEstimateHighEstimate P(90) (2)P(50) (2)P(10) (2)Anca§103337803Maria1977263Nadia56199612Paula§133872Voinicul Updip71940  §On BlockA new oil prospect, Irina, has also been mapped in the Pelican block on trend with the Eugenia prospect and has been evaluated by RPS Energy. Unrisked(1) Prospective Resources (MMstb)as at May 31, 2012Company Share LowEstimateBestEstimateHighEstimate P(90) (2)P(50) (2)P(10) (2)Irina§144330  §On Block"These additional resource numbers in the Midia block demonstrates the exciting potential of this part of our concession.  Similarly the Irina oil prospect confirms the additional potential for the oil prone Pelican block alongside the Eugenia and Mihaela prospects," stated John Rapach, Chief Operating Officer of Sterling.    (1) Prospective Resources are those quantities of petroleum estimated as of a given date to be potentially recoverable from undiscovered accumulations by application of future development projects. The values presented above are total Prospective Resource volumes before the application of geologic risk. In each of the identified prospects, there is geologic risk, that is there is no certainty that any portion of the Prospective Resources will be discovered.  RPS estimates the Geologic Chance of Success (GCoS), the technical probability that the prospect contains recoverable hydrocarbons in the volumes described, after accounting for the combined risk elements of hydrocarbon source and migration pathway, reservoir presence, reservoir trap and reservoir seal, to range from 9% to 25% dependent on the predicted reservoir and type of trap. Higher GCoS are expected for prospects where the target is a reservoir found in adjacent discoveries such as Eocene and Upper Cretaceous formations (Lebada Field, Olimpiyskaya discovery) and Dacian and Pontian formations (Ana, Doina field and the Cobalcescu discovery). Lower GCoS have been estimated where the target is a reservoir (Oligocene slump systems) which to date has not been drilled in the Black Sea, but have been shown to be prospective in other areas of the world. Further, if any of these prospects are discovered, there is no certainty that it would be commercially viable to produce any portion of the Resources. These Prospective Resources are in areas of the field or geological horizons, in which the presence of recoverable hydrocarbons requires confirmation by drilling.          (2)  The P(50) is considered to be the best estimate of the quantity that, if discovered, will actually be recovered. If probabilistic methods are used there is at least a 50 percent probability P(50) that the quantities actually recovered will equal or exceed the estimate. Similarly, the P(90) or P(10) represent the low and high estimates respectively.Sterling Resources Ltd. is a Canadian-listed international oil and gas company headquartered in Calgary, Alberta with assets in the United Kingdom, Romania, France and the Netherlands.  The shares are listed and posted for trading on the TSX Venture Exchange under the symbol "SLG".Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.Filer Profile No. 00002072Forward-Looking StatementsAll statements included in this press release that address activities, events or developments that Sterling expects, believes or anticipates will or may occur in the future are forward-looking statements. In addition, statements relating to reserves or resources are deemed to be forward-looking statements as they involve the implied assessment, based on certain estimates and assumptions that the reserves and resources described can be profitably produced in the future.These forward-looking statements involve numerous assumptions made by Sterling based on its experience, perception of historical trends, current conditions, expected future developments and other factors it believes are appropriate in the circumstances.  In addition, these statements involve substantial known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other-forward looking statements will prove inaccurate, certain of which are beyond Sterling's control, including: the impact of general economic conditions in the areas in which Sterling operates, civil unrest, industry conditions, changes in laws and regulations including the adoption of new environmental laws and regulations and changes in how they are interpreted and enforced, increased competition, the lack of availability of qualified personnel or management, fluctuations in commodity prices, foreign exchange or interest rates, stock market volatility and obtaining required approvals of regulatory authorities. In addition there are risks and uncertainties associated with oil and gas operations.  Readers should also carefully consider the matters discussed under the heading "Risk Factors" in the Company's Annual Information Form.Undue reliance should not be placed on these forward-looking statements, as there can be no assurance that the plans, intentions or expectations upon which they are based will occur.  Sterling's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements.  These statements speak only as of the date of the press release. Sterling does not intend and does not assume any obligation to update these forward-looking statements except as required by law.Financial outlook information contained in this press release about prospective results of operations, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management's assessment of the relevant information currently available.  Readers are cautioned that such financial outlook information contained in this press release should not be used for purposes other than for which it is disclosed herein.For further information: Visit or contact: Mike Azancot, President and Chief Executive Officer, Phone: 44-20-3008-8488, Mobile: 44-7740-432883, David Blewden, Chief Financial Officer, Phone: 44-20-3008-8488, Mobile: 44-7771-740804, George Kesteven, Manager, Corporate and Investor Relations, Phone: (403) 215-9265, Mobile: (403) 519-3912,