Heritage Oil Gains on Kurdistan Update

Shares in Heritage Oil Plc (LSE: HOIL), the independent upstream exploration and production company with operation in Iraqi Kurdistan, were up more than 5% this morning after the company issued an Interim Management Statement for the periond July 2010 to 17 November 2010.

Highlights

  • The Miran West-2 well, in the Kurdistan Region of Iraq, has reached a total depth of 4,426 metres
  • The well has encountered indications of hydrocarbons from intervals within the Cretaceous, Jurassic and Triassic in excess of 2,500 metres
  • Numerous zones for testing have been identified and testing operations have commenced
  • Production in Russia averaged 516 bopd for the third quarter of 2010
  • As at 30 September 2010, Heritage’s cash position was $614 million, excluding reserved amounts related to the tax dispute in Uganda

EXPLORATION ASSETS

Kurdistan Region of Iraq

The Miran West-2 well has reached a total depth of 4,426 metres. The well encountered indications of hydrocarbons from intervals within the Cretaceous, Jurassic and Triassic in excess of 2,500 metres. A number of zones within these intervals have been identified for testing in both the deeper exploration targets and the initial appraisal objective in the Cretaceous. Testing operations have commenced and a further update will be provided on completion of these tests, expected within the next couple of months.

The acquisition of approximately 550 square kilometres of 3D seismic over the Miran Block has recently commenced. This, along with an extensive fieldwork study that began in October 2010, will help establish future drilling locations to exploit the reservoirs’ fracture networks.

Heritage is looking to contract at least one rig to continue the drilling programme across the Block in 2011 which will include an exploration well on the Miran East structure.  Heritage has operated in Kurdistan for approximately 700 days without any lost time or environmental incidents.

Other Assets

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