Petroceltic International issues an update on operations at the Ain Tsila field on its Isarene permit (Blocks 228 & 229a) in south eastern Algeria. Petroceltic operates the permit with a 56.625 % interest, Sonatrach holds a 25% interest, and Enel holds an 18.375% interest, pending final Government of Algeria ratification.

•AT-6 testing results •AT-8 and AT-9 operations update AT-6 testing results

The AT-6 well, the third well in the current appraisal campaign on the Ain Tsila gas discovery, was drilled to a total depth of 2085m. The main objective of this well was to prove up Gas in Place in the south eastern extremity of the field outside the control of the 3D seismic area. This objective was successfully achieved, confirming the presence of the Ain Tsila gas column at this location and thus providing further evidence of the significant size of the in place gas resource on the structure. Testing operations commenced on 31st August and the well was suspended on 10th September.

A number of intervals in the objective Ordovician formation from 1952m to 1977m were perforated with one interval hydraulically fractured. The well was subsequently lifted with nitrogen to aid clean up however no flow was observed. The well was suspended for further analysis and possible future re-fracturing and the rigless testing unit has been mobilised to the AT-8 well location in the north of the field.

AT-8 operational update

The AT-8 well, a vertical well located in the north of the Ain Tsila field, is currently preparing to commence testing operations. The well reached a total depth of 2123m on 22 August 2011. It is located within the area of the 3D seismic data, 5km north east of the AT-1 well and 4.5km north west of the AT-5 well, in an undrilled section of the field. It was located to appraise a pop-up feature with a mapped fault system and to test the extent of the hydrocarbon column in the north of the field. Testing operations will commence on this well in the coming days once the rigless testing unit has remobilised from the AT-6 well location. The test programme will include hydraulic fracturing of the main reservoir interval, and results are anticipated in early October. After completion of the testing operations on the AT-8 well, the rigless testing unit will move to test the AT-7 well.

AT-9 operational update

Drilling on the AT-9 well with the KCA Deutag Rig T-211 commenced on 12th September. This well is the 6th well of the current Isarene licence appraisal campaign.

The AT-9 well is a horizontal appraisal well and is located towards the centre of the Ain Tsila field 4.3km north east of the AT-2 appraisal well and 7.8km south east of the AT-1 discovery well. Its main objective is to assess the productivity associated with a structural feature that is of a different style to those already tested at AT-5 and AT-8, and in an area between two known productive wells (AT-1 and AT-2).

It is anticipated that the well will take about 60 days to drill. Testing will be carried out with the rigless testing unit once it has completed operations on AT-7, which is anticipated to be around the middle of November 2011.

Brian O’Cathain, Chief Executive of Petroceltic commented,“Although no gas flow rate has been achieved at this location, the result of the AT-6 well confirms the presence of the Ain Tsila gas column to the south of the 3D seismic area and provides further evidence of the significant scale of the Ain Tsila in place gas resource. The results of the overall programme to date have confirmed gas columns that have exceeded pre-drill expectation. We now look forward to seeing the results of a number of wells where we believe the potential for enhanced flow rates exist. The programme remains on schedule for submission of the Final Discovery Report in Q1 2012.”

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