SAN FRANCISCO, Feb. 10, 2011 /CNW/ -- GeoPetro Resources Company (NYSE
Amex: GPR) ("GeoPetro", "we", "our" or the "Company") is pleased to
announce that Linc Energy Ltd. ("Linc"), the Operator of the Alaska
Leases in the Cook Inlet region, reported today that their analysis has
confirmed that the LEA #1 well penetrated three significant sand
formation intervals that appear to be gas charged and that LEA #1 gas
samples have confirmed 99% to 100% purity of dry natural gas. As
previously announced late last year, the LEA #1 well, located in the
Point Mackenzie Block of the Cook Inlet Basin, Alaska encountered a
number of gas bearing horizons and was completed in November 2010.
External contractors were engaged to conduct advanced petrophysical log
analysis. Planning was also initiated for a gas flow testing program to
define the commercial outcome.
The advanced petrophysical well log analysis (ELAN analysis by
Schlumberger) was performed on the electrical logs run in the hole. The
results of the analysis have confirmed three significant sand formation
intervals that appear to be gas charged and which possess apparent
permeability values indicating they are good candidates for a flow
This data supports the strong gas shows that were observed throughout
the initial drilling of the LEA #1 exploration well. Linc Energy
reported that the gas shows were first encountered soon after drilling
penetrated the top of the target Tyonek Formation. Down hole gas
pressures increased as the LEA #1 well was drilled deeper, which meant
that the drilling team had to increase the density of the drilling
fluids to maintain safe conditions and constrain the free flow of gas
to the surface. The well site team collected physical gas samples for
Linc reported that gas from LEA #1 was sampled from 31 intervals from
depths of 1,500 feet to the total depth of 6,323 feet. The completed
analysis of that gas confirmed that all 31 samples contain pure, dry
natural gas (methane: CH4) in the range of 99% to 100%. Natural gas of
this purity does not require treatment or conditioning before
delivering it to market. The well is located approximately 1.5 miles
from a major pipeline capable of carrying the gas to market.
The adverse weather and freezing conditions in Anchorage prevented Linc
from completing the planned flow tests over the Christmas period. These
severe weather conditions can alter the results of the flow test and
significantly increase testing costs. The Operator is planning to carry
out these tests as soon as the severe cold temperatures of the Alaskan
winter have passed. The Operator has reported that they are aiming to
have a Flow Test Rig on site in late March 2011.
Stuart J. Doshi, President and CEO of GeoPetro Resources Company, said,
"The recent announcement by Linc on the LEA #1 is promising. We are
excited about the potential of a commercial gas discovery in Alaska.
This could be the beginning of an aggressive drilling program on the
In addition to testing LEA #1 and continuing to develop the Point
Mackenzie Block, Linc Energy has confirmed that it will push ahead with
the start up of phase two of the Alaskan natural gas drilling program
by the middle of this year in the Trading Bay Block leases which are
located on the northwest side of the Cook Inlet approximately 70 miles
from the site of LEA #1. These leases hold a number of promising
prospects that Linc plans to aggressively pursue.
Under the terms of the Purchase and Sale Agreement with Linc, GeoPetro
will receive US$4.0 million from the proceeds of the first seventy-five
percent (75%) of 8/8ths of the oil and gas production produced from or
attributable to the Alaska Leases. After GeoPetro has received the
US$4.0 million payment, GeoPetro will thereafter receive an overriding
royalty interest of ten percent (10%) of 8/8ths of the proceeds of oil
and gas production produced from or attributable to the Alaska Leases.
GeoPetro will provide additional updates as it gains further information
on LEA #1 well.
GeoPetro is an independent oil and natural gas company headquartered in
San Francisco, California. GeoPetro currently has projects in the
United States, Canada and Indonesia. GeoPetro has developed a producing
oil and gas property in its Madisonville Field Project in Texas.
Elsewhere, GeoPetro has assembled a geographically-diversified
portfolio of exploratory and appraisal prospects.
This news release contains forward-looking information. Statements
contained in this news release relating to future results, events and
expectations are forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended and Section 21E
of the Securities Exchange Act of 1934, as amended. These
forward-looking statements may involve known and unknown risks
involving market prices for natural gas and oil, economic and
competitive conditions, regulatory changes, resource estimates,
estimates of proved and probable reserves, production forecasts,
geological and engineering uncertainties, potential failure to achieve
production from development drilling projects, capital expenditures and
other risks and uncertainties, which may cause the actual results to be
materially different from those expressed or implied by such
statements. Additional risk factors include, among others, those
described in the Company's Annual Report on Form 10-K on file with the
U.S. Securities and Exchange Commission. We do not have any intention
or obligation to update forward-looking statements included in this
press release after the date of this press release, except as required
No stock exchange or regulatory authority has approved or disapproved of
the information contained herein.
SOURCE GeoPetro Resources Company
For further information:
For further information: Stuart J. Doshi, President & CEO of GeoPetro Resources Company, +1-415-398-8186, firstname.lastname@example.org Web Site: http://www.geopetro.com