January 2009 Shareholder Update: Technical Re-evaluation and Future Plans



    Trading Symbol: NRS

    VANCOUVER, Jan. 21 /CNW/ - Norwood Resources Ltd. (the "Company") reports
that the Company is planning a 'twin well' offsetting its San Bartolo well,
which had the "best" oil shows of the three wells drilled thus far and
presents the least risk in attaining profitable production on its concession
in Nicaragua. The well is planned for sometime later this year subsequent to
the completion of an extensive re-evaluation of technical data and a general
improvement in stock market and financing conditions. In the meantime, the
Company has put its field operations on temporary suspension in order to
reduce expenditure and preserve cash while the board and management focus
their efforts on identifying alternative means of financing and other options
available to the Company to pursue project objectives effectively.
    Subsequent to the completion of its 2008 testing program, the Company
contracted 3 independent expert well analysts to review data and results from
its San Bartolo and Maderas Negras well bores. Petrophysicists Melvin Hinds of
Fronterra Geosciences in Midland Texas; John Hitchner of Hitchner Exploration
Services, Calgary, Alberta; Al Lye of Al Lye & Associates, Calgary Alberta
each analyzed the San Bartolo-1 and Maderas Negras well logs. Their analysis
concludes that moveable oil appears to be present in both well bores and
improper testing techniques most likely account for the failed tests. The
recovery of 60bbls of 39 API oil through swabbing from zone 11b on June 14,
2008 and 13bbl of 34 API oil from zone 7 on reverse circulation on June 26,
2007 indicates the San Bartolo well does contain high grade recoverable oil
and likely presents the lowest risk opportunity to prove up commercial
quantities of oil from the three well bores. These zones also provide some
calibration for moveable oil identification on logs.
    The three petrophysicists listed hydrocarbon-bearing zones for future
coring and testing in San Bartolo from highest priority to lowest according to
porosity, resistivity and water saturation measurements. The results are as
follows:

    
    -------------------------------------------------------
                                  Cored
                Zone      Zone     zone   Porosity   Water
    Priority     top      Base    length     est     Satn
    -------------------------------------------------------
    4           2850      2900      50       18       43     Masachapa Zone
    -------------------------------------------------------
    5           5900      5950      50       13       40     Zone 11b
    -------------------------------------------------------
    1           6250      6280      30       15       35     Zone 7
    -------------------------------------------------------
    2           6370      6420      50       16       42     Zone 6
    -------------------------------------------------------
    3           7225      7290      65       12       30     Zone 4
    -------------------------------------------------------
    5           7590      7670      80       14       32     Deep zone
    -------------------------------------------------------
    

    These 6 zones were chosen as "most likely" oil-bearing zones from the
three independent petrophysical analyses. Other zones were identified as
prospective within the San Bartolo well bore by one or more of the
petrophysicists. These zones are potentially oil bearing but until core is
obtained and logs are calibrated, these zones are considered riskier targets.
    The reservoirs, which are normally pressured, contain "non-traditional"
volcaniclastic, feldspathic sandstones with 10-35% hydrophilic clays.
Porosities are 12-18% with water saturations of 30-45%. Permeabilities are
poorly known but appear to range from less than 10md up to 20-30md in some of
the better zones. Fracture stimulation and artificial lift will likely be
required. Calculated flow rates are forecast to be 80-200 bopd per zone
'unstimulated' and 350-500 bopd per zone with 'fracture stimulation'.
    The planned new well, San Bartolo-2, will be drilled to test these zones
in an undamaged well bore. The Company's technical team and engineering
consultants are evaluating various drilling, cementing and completion
techniques, which will best suit the new well design. As part of this process,
they are also reviewing effective testing and completion techniques from
similar reservoirs in India, Thailand, Argentina and Western Canada, which
have been completed successfully.
    In conjunction with these efforts, the Company has contracted RPS
Engineering ("RPS") in Calgary to conduct a full review of the 2008 testing
program of the Maderas Negras and San Bartolo wells. RPS will also provide
recommendations for 'best practices standards' for future engineering,
drilling and completion stages of the next well. With these recommendations
and those resulting from the programmed technical meetings, the Company will
have a detailed plan applying appropriate technologies and on site expertise
to produce oil from San Bartolo-2 in the most technically effective and cost
efficient manner possible.

    
    ON BEHALF OF THE BOARD OF DIRECTORS OF
    NORWOOD RE

SOURCES LTD. "Raymond Cahill" Raymond Cahill President & CEO WE SEEK SAFE HARBOUR This press release contains certain forward-looking statements. While these forward-looking statements represent our best current judgment, they are subject to a variety of risks and uncertainties that are beyond the Company's ability to control or predict and which could cause actual events or results to differ materially from those anticipated in such forward-looking statements. Accordingly, readers should not place undue reliance on forward-looking statements. THE TSX VENTURE EXCHANGE DOES NOT ACCEPT RESPONSIBILITY FOR THE ACCURACY OR ADEQUACY OF THIS RELEASE

For further information:

For further information: about Norwood Resources Ltd. (NRS) contact:
Raymond Cahill, President & CEO, E-Mail: info@norwoodresources.com, Telephone:
(604) 642-6566

Organization Profile

NORWOOD RESOURCES LTD.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890