| WEEKLY DRILLING REPORT (31-08-00) |
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SALFLEETBY-5 DRILLS INTO NAMURIAN OBJECTIVE; KYLE NORTHEAST REPORTS GOOD OIL AND GAS SHOWS AND FRACTURES IN CHALK RESERVOIR; AND IRWES-1 SETS CASING IN MONGOLIA 1. DRILLING OPERATIONS 1.1 Onshore UK: Saltfleeby-5 (ROC: 100%) Since ROC released its last Drilling Activity Update to ASX (24 August 2000) the Saltfleetby-5 well has set 5 inch liner at 2,742 metres (2,299 meters true vertical depth (TVD)) and drilled out into the Namurian reservoir objective, the top of which was encountered at 2,756 metres (2,300 metres TVDSS) one metre high to Saltfleetby-3. As of 08:00pm on 30 August (UK time) the well had drilled 90 metres of essentially horizontal hole within Namurian sandstones with moderate to good gas shows. The forward plan is to drill up to an additional 200 metres of horizontal hole prior to logging and, if warranted, testing the gas potential of the Namurian sequence which has never previously been tested at Saltfleetby. If the Namurian proves to be water productive, the well will be completed as a gas producer in the main Westphalian gas reservoir. 1.2 UK North Sea:The Kyle Northeast Appraisal Well (ROC: 12.5%) Since the last Drilling Activity Update the Kyle 29/2c-13 appraisal well (also known as the Kyle Northeast well) was drilled to a total depth of 3,825 metres (2,112 metres TVDSS) in the upper part of the Chalk, which is the main reservoir target. During the drilling of the Chalk good oil and gas shows were recorded and mud losses indicative of fracture systems were reported. The forward plan is to log and, if warranted, test and complete the well. 1.3 East Gobi Basin, Mongolia: Irwes-1 (ROC: 100%) Since the last Drilling Activity Update, Irwes-1 drilled to 239 metres and has set 13 3/8 inch casing at 236 metres. The shallow section which has been drilled thus far by Irwes-1 was not considered to be a reservoir target at this location, but its lateral equivalent is considered to be a potential reservoir objective in the Temee-1 well which will be drilled as soon as Irwes-1 is finished. In this context, it is, perhaps, encouraging that the shallow section drilled thus far in Irwes-1 consists of sandstones and conglomerate with good potential reservoir characteristics. The forward plan is to drill out of the 13 3/8 inch casing towards the 9 5/8 inch casing point at 800 metres. The total depth of the well is forecast to be 1,300 metres. Dr
John Doran |
| UPDATE (30-08-00) |
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ROC'S FINANCIAL RESULTS FOR FIRST HALF 2000 HIGHLIGHT $27.4 MILLION AFTER TAX PROFIT TURNAROUND HIGHLIGHTS (1) · $21.4 million operating profit after income tax expense including abnormal items; a $27.4 million turnaround from the $6.0 million loss reported for full year 1999. (2) · 20.2 cents earnings per share; representing a 30.2 cents per share turnaround from the negative 10.0 cents per share weighted average for 1999. · $6.3 million after tax profit, without reference to abnormal items; a $10.6 million turnaround from the $4.3 million loss reported for full year 1999. The equivalent profit figure quoted in ROC's June 1999 Prospectus for full year 2000 is $13.1 million. On this basis, the result for the first half of 2000 is in line with Prospectus forecast - despite the revenue reduction resulting from the non-core asset sale.(3) · $18.1 million abnormal profit after income tax expense on the $57 million sale of non-core UK assets. · $45.4 million total sales revenue; up $28.8 million (174%) from the $16.6 million equivalent figure for full year 1999. · $43.2 million EBITDA; up $43.1 million on equivalent figure for full year 1999. · $45.0 million cash flow from operations; up $46.4 million from the negative $1.4 million cash flow equivalent figure for full year 1999. · 1.87 million barrels of oil equivalent (MMBOE) total oil, gas and NGL production; up 1.34 MMBOE (256%) from the 0.53 MMBOE produced during the whole of 1999. · $59.3 million cash as at 30 June 2000; up $33.4 million (129%) from $25.9 million cash at 31 December 1999. · No net debt at 30 June 2000; compared to $44.7 million net debt at end 1999. · US$30.5 million borrowing under the UK syndicated loan facility; down US$15.5 million (33.6%) from US$46.0 million at end 1999 with no further repayments until the second half of 2001. · Strong UK gas prices; during the second quarter of 2000 UK domestic spot gas prices increased by approximately 60% compared to spot gas prices for the same period in 1999. CEO'S COMMENTS Commenting on the first half 2000 results ROC's Chief Executive Officer, Dr John Doran, stated that: - "Gas prices in the UK have been strong during the second quarter of 2000 but this fact has found itself in the Cinderella shadow cast by the much higher profile, strong and rising, global oil prices. As far as ROC is concerned it is indifferent to the type of hydrocarbon molecules it produces and sells, as long as they fetch a good price; and this is exactly what Saltfleetby gas has been doing during the second quarter of 2000. - Strong product prices are not very relevant if a company doesn't have a solid production base and this is where ROC's 100% owned and operated Saltfleetby Gas Field has delivered a production result considerably in excess of the Prospectus forecast. It is easy to forget that when this forecast was made, a little more than a year ago, Saltfleetby was a partially appraised, undeveloped, field with only two wells completed for future gas production. Approximately six months later the field came on to production at approximately 50 million cubic feet per day and stayed at, or very close to, that plateau rate throughout the first six months of 2000. - ROC's average closing share price for December 1999 was $1.46. Coincidentally, yesterday the closing share price was also $1.46. While these figures might superficially suggest no change, this report clearly demonstrates that ROC's financial fundamentals have improved significantly since the end of last year." IMPORTANT NOTES 1. Under separate cover earlier today ROC released to ASX its detailed half-year 2000 results accompanied by the statutory Appendix 4B. 2. Because ROC did not become a publicly listed company until 5 August 1999, it is not possible to make any meaningful comparison between the Company's financial results for the first half of 2000 and the equivalent six month period last year. However, in order to provide shareholders with a relevant perspective, the first half 2000 financial results are compared to the results for the whole of 1999 and, where appropriate, with the relevant financial forecasts for a full year 2000 as documented in ROC's June 1999, Prospectus. 3. Effective 1 March 2000, ROC sold its non-core oil producing assets onshore UK (the "non-core asset sale") which, at the time, represented approximately 19% of the Company's daily oil and gas production. This sale generated an abnormal, after tax, profit of $18.1 million on assets which had effectively been owned for only seven months and which had generated during that period $16 million of sales revenue. The non-core asset sale, was structured to allow ROC to retain significant exposure to continuing strong oil prices during 2000 and 2001. The sale was not foreshadowed in ROC's June 1999 Prospectus. Therefore, if a strict (like-for-like) comparison was to be made with ROC's Prospectus the relevant first half 2000 figures would need to be adjusted to take into account the revenue reduction which resulted from the non-core asset sale. However, ROC has chosen not to make any such adjustment to its trading profit figures because, despite the revenue reducing effect of the sale, the profit for the first half of 2000 is still generally in line with the Prospectus profit forecast. Dr
John Doran Return to ASX Releases main page
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| UPDATE (25-08-00) |
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ROC FORESHADOWS STRONG FIRST HALF 2000 FINANCIAL RESULTS ROC is pleased to advise that it intends to release its detailed financial results for the first half of 2000 on Wednesday or Thursday of next week (30/31 August). Despite the 1 March 2000 sale of its non-core onshore UK oil producing assets (the "non-core asset sale") ROC's half yearly results are expected to demonstrate that the Company is still heading towards a full year 2000, after tax, pre-abnormal, profit generally in line with the $13.1 million equivalent profit forecast quoted in its June 1999 Prospectus. This full year 2000 profit expectation does not take into account the $18 million after tax, abnormal, profit generated by the non-core asset sale. Dr
John Doran |
| WEEKLY DRILLING REPORT (24-08-00) |
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1. DRILLING OPERATIONS 1.1 Onshore UK: Saltfleeby-5 (ROC: 100%) Since ROC released its last Drilling Activity Update to ASX (18 August 2000) the Saltfleetby-5 well has drilled 284 metres (37 metres true vertical depth (TVD)) through the main Westphalian gas reservoir to a depth of 2,725 metres (2,304 metres TVD) where 5 inch liner is being set prior to drilling ahead into the targeted Namurian section, the top of which is expected at 2,785 metres (2,308 metres TVD) (Figures 1 and 2). If warranted, a 300 metre horizontal section will be drilled within the Namurian in order to evaluate the gas potential of this sequence which had some gas shows in Saltfleetby-3, albeit associated with apparently high (log-derived) water saturations. If, the Namurian, which has never been tested at Saltfleetby, is water-bearing the well will be completed as a gas producer in the main Westphalian reservoir. A comparison of the main Westphalian gas reservoir in the currently drilling Saltfleetby-5 and its equivalent in Saltfleetby-3, approximately 400 metres to the southeast, indicates comparable reservoir quality, gross reservoir thickness and net gas pay. 1.2 UK North Sea: The Kyle Northeast Appraisal Well (ROC: 12.5%) Since the last Drilling Activity Update the Kyle 29/2C-13 appraisal well (also known as the Kyle Northeast well) has drilled to a depth of 3,155 metres (2,114 metres TVDSS) in the upper part of the Chalk, after recovering 5.2 metres of core near the top of that formation. 1.3 East Gobi Basin, Mongolia: Irwes-1 (ROC: 100%) Irwes-1 started drilling on Wednesday 23 August at a location approximately 28 kms southwest of the railhead at Zuunbayan where ROC's field support and oil storage facilities are located. The well, which will take approximately two to three weeks to drill, will test a prospect with an areal extent of 5 sq km/1,200 acres and a robust vertical closure of 200 metres/650 feet. Irwes-1 will test parts of the Mesozoic sequence which have never before been drilled within defined closure in the East Gobi Basin. In fact, for all practical purposes, Irwes-1 can be regarded as the first modern exploration well to be drilled in Southern Mongolia and, as such, it is considered to be a high risk wildcat well. Dr
John Doran |
| WEEKLY DRILLING REPORT (18-08-00) |
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1. DRILLING OPERATIONS 1.1 Saltfleeby-5 (ROC: 100%) The Saltfleetby-5 well has drilled into the top of the main Westphalian reservoir sands and casing has been run and cemented to a depth of 2,441 metres (2,267 metres TVD). After drilling through the main Westphalian reservoir, the well is scheduled to drill to a total depth of 3,200 metres including, if warranted, a 300 metre horizontal section designed to test the gas potential of the underlying Namurian which has not been tested to date. 1.2 The Kyle Northeast Appraisal Well (ROC: 12.5%) The Kyle 29/2C-13 appraisal well (also known as the Kyle Northeast well) is at a depth of 9,202 ft in the top of the Chalk, the main reservoir target, and 9 5/8 inch casing has been run and cemented. Pipe Conveyed logging has been completed over the Palaeocene sands, immediately above the Chalk, and encouraging hydrocarbon indications were reported. The next operation will be to drill out of the 9 5/8 inch casing shoe, into the Chalk before taking a core of the potential Chalk reservoir. Dr
John Doran |
| WEEKLY DRILLING REPORT (11-08-00) |
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1. DRILLING OPERATIONS 1.1 Saltfleeby-5 (ROC: 100%) As of 4 p.m. on 10 August (UK time) the Saltfleetby-5 well was drilling ahead in 8 ½ inch hole at a depth of 2,352 metres (2,235 metres TVD) in the Westphalian Coal Measures. Subject to continuing satisfactory progress, the well is expected to have penetrated the Namurian target by early September. 1.2 The Kyle Northeast Appraisal Well (ROC: 12.5%) As of 6 pm7 a.m. on 10 August (UK time) the Kyle 29/2C-13 appraisal well (otherwise known as the Kyle Northeast well) had drilled the 12 ¼ inch hole to a depth of 9,202 ft and had intersected the top of Chalk, the main reservoir target. Formation tops drilled were found to be close to the seismic predictions. Some hydrocarbon shows were encountered in Palaeocene sands immediately above the Chalk and some mud losses were recorded in the Chalk. The rig is currently circulating and conditioning the hole before preparing to pull out to run Pipe Conveyed Logs. 9 5/8 inch casing will then be run and cemented at a high angle (73 deg) into the top of the Chalk. Logging, running and cementing the casing is expected to take 7-8 days. After setting the 9 5/8 inch casing drilling will continue, taking a core of Chalk soon after drilling out of the 9 5/8 inch shoe. Dr
John Doran |
| SUMMARY OF ACTIVITIES (04-08-00) |
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1. DRILLING OPERATIONS 1.1 Saltfleeby-5 (ROC: 100%) As of 6 p.m. on 3 August (UK time) the Saltfleetby-5 well had reached a depth of 1,909 metres (1,867 metres TVD) and was changing the bottom-hole assembly in preparation for directional drilling towards the reservoir sequence. The 3,200 metre well, including, if warranted, a 300 metre horizontal section, is designed to test the gas potential of the Namurian which underlies the field's main Westphalian reservoir and which has not been tested to date. Subject to continuing satisfactory progress, the well is expected to have penetrated the Namurian target by early September. 1.2 The Kyle Northeast Appraisal Well (ROC: 12.5%) As of 7 a.m. on 3 August (UK time) the Kyle 29/2C-13 appraisal well (otherwise known as the Kyle Northeast well) was drilling ahead at 1,562 metres (1,359 metres TVD). The well is expected to have penetrated the two main reservoir objectives by mid August. 1.3 Irwes-1 Wildcat Exploration Well, Mongolia (ROC: 100%) Preparations are underway for the drilling of the Irwes-1 wildcat well in ROC's acreage in the Gobi Desert in Southern Mongolia. The well is expected to commence drilling on schedule in the latter part of August and it is anticipated that it will have penetrated the main potential reservoir objectives by early September. ROC's second exploration wildcat in Mongolia, Temee-1, will be drilled immediately after Irwes-1 is completed. 2. PRODUCTION TESTING 2.1 Keddington-2 (ROC: 100%) On 2 August, 2000, Keddington-2 started pumping oil with anticipated levels of associated gas. It is expected that oil production will stabilise over the next few days as the gas associated with the higher oil rates is regulated. The longer term potential of the Keddington-2 well cannot be assessed until a reliable production history has been established. 2.2 Kyle Extended Well Test (EWT) (ROC: 12.5%) This EWT continues to perform very satisfactorily. An expected increase in the gas-oil ratio has been stabilised by reducing the oil rate to around 10,000 BOPD to ensure that total gas and oil production from the EWT remains within the guidelines defined by the UK Department of Trade and Industry (DTI). 2.3 Mongolian Operations ROC's combined oil production from its three producing wells in the East Gobi Basin in southern Mongolia continues to average approximately 120 BOPD. The fourth transhipment of export oil to China for calendar 2000 is in the process of being completed, subsequent to which ROC will have exported a total of 30,000 barrels of Mongolian oil to China since the current transhipment program commenced in June 2000. Subsequent to the current batch of oil being exported, ROC will have approximately 8,500 barrels of oil in storage at its field facility at Zuunbayan.
Dr
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