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Repsol plugs and abandons Namibia offshore well

13th June 2014

Repsol, the operator of Namibia PEL0010 (Repsol 44 per cent working interest, Tower Resources 30 per cent working interest), have announced that the Welwitschia-1A well has found no viable hydrocarbon resources and will be abandoned till further survey work can be carried out

Repsol plugs and abandons Namibia offshore well
The joint venture partners have agreed not to drill further at this time and to evaluate the information and its implications for the block

The estimated cost of continuing the current well to test the deeper targets, including the Albian, now appears to be as much as a further USD 40m gross.

The well is being plugged and abandoned.

Despite interest in the deeper targets, with their large potential resources, the joint venture partners plan to wait for the full analysis of the current well before deciding whether and where to drill a second well and test the deeper targets with the benefit of that further information.

As a result, the joint venture partners have agreed not to drill further at this time and to evaluate the information and its implications for the block.

"Our first well in this huge frontier block has shown that the Maastrichtian and Palaeocene reservoir sands were less well-developed in this location than we had hoped for, which was always recognised as a critical risk factor,” said Nigel Quinton, Tower Resources head of exploration. “As of now, our view of the prospectivity of the deeper section including the Albian carbonates, remains unchanged. As usual in frontier areas, it will take time to fully interpret the results of the well and assess the implications for the remaining prospectivity of PEL0010."

Current expectations from Repsol are that costs will now be around 10 per cent in excess of the USD 91m gross firm well budget.

The Rowan Renaissance drillship commenced drilling operations on PEL0010 on 23 April 2014 and the Welwitschia-1A well spud on 1 May 2014. Repsol, the operator of Namibia PEL0010 (Repsol 44 per cent working interest, Tower Resources 30 per cent working interest), confirmed that the firm commitment well reached total depth of 2,454 metres TVDRT (total vertical depth below rotary table). Logging evaluations indicate that the Palaeocene, Maastrichtian and upper Campanian section reservoirs were less well-developed than predicted and no hydrocarbons were encountered.

Drilling has been behind schedule initially owing to late rig-delivery and operational issues during drilling and logging, including the onset of winter weather conditions.

“The well emphasises the risk of exploration and the wisdom of having moved to diversify our portfolio,” said Graeme Thomson, Tower Resources CEO. “We expect much activity in the coming months on and in the areas surrounding our assets. In South Africa we await the new 3-D on our Algoa-Gamtoos block and Total is scheduled to be drilling its Brulpadda-1 well on the adjacent block shortly. Planning for our year-end Badada-1 well on Block 2B onshore Kenya is underway and regional activity is rising. Our projects in Zambia, SW Orange Basin SA, Cameroon, Ethiopia and elsewhere are gaining momentum."

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