CALGARY, Aug. 1 /CNW/ - Cirrus Energy Corporation ("Cirrus") (TSXV: CYR)
on behalf of its wholly owned subsidiary, Cirrus Energy Nederland B.V., is
pleased to report the following significant progress with respect to the M7-A
gas development in The Netherlands.
Block M7 (Cirrus 42.75% and operator)
On July 30, 2007, partners approved the M7-A Field development budget and
AFE which totals (euro) 62.7 million gross (approximately $91.7 million).
Cirrus' net share is (euro) 26.8 million (approximately $39.2 million). The
development plan includes re-entry and side-tracking of the suspended M7-5ST
well with completion via a minimum facilities monopile wellhead platform. Gas
will be produced via a 12.2 km, 6 inch pipeline to third party processing and
export infrastructure. First gas is expected in the fourth quarter of 2008.
The M7 production licence covers 410 km2 with water depths around 30 m.
The M7-5ST well, drilled in 1996, discovered gas in overpressured, high
quality Triassic-aged sandstones at true vertical depths around 2800m and was
tested at a maximum rate of 30.1 mmscf/d of dry gas from a 22m gross interval.
Most likely recoverable reserves in the tested Triassic reservoir from a
single development well are 32 bcf (as estimated by GLJ, Dec 1 2006, pursuant
to NI51-101). Average first year gross production is expected to be
21 mmscf/d. Well M7-5ST also discovered and tested gas in overlying
Jurassic-aged sandstones, although at low rates, and this reservoir is not
planned to be completed and produced in the initial field development. These
sands may be a target in future appraisal of the field.
Cirrus has accepted a written offer of financing from the Royal Bank of
Scotland ("RBS") for a five year borrowing base facility (the "Facility") of
(euro) 30.0 million. The Facility will be provided by RBS subject to
satisfactory documentation, due diligence and the achievement of all required
conditions precedent which are usual in such agreements. The Facility will be
used primarily to finance development of the M1-A and M7-A fields.
Cirrus' President, David Taylor, comments, "Achieving partner approval of
the M7-A field development marks another significant milestone in Cirrus'
strategy of developing fallow fields in the Netherlands. With the recent
partner approval of the M1-A field development, Cirrus can now progress both
developments in parallel to maximise synergies between the projects such as
the contracting of the Noble Lynda Bossler drilling rig in second half 2008.
We are also delighted to have RBS as our financial partner for both the
M1-A and M7-A developments. RBS has a well deserved reputation in financing
North Sea developments and we look forward to building on this relationship as
Cirrus pursues additional opportunities in the Dutch North Sea."
Cirrus Energy Corporation is an international oil and gas company
headquartered in Calgary and currently has 47.5 million fully diluted common
This press release may include forward-looking statements including
opinions, assumptions, estimates and expectations of future production, cash
flow and earnings. When used in this document, the words "anticipate,"
"believe," "estimate," "expect," "intent," "may," "project," "plan", "should"
and similar expressions are intended to be among the statements that identify
forward-looking statements. Forward-looking statements are subject to a wide
range of risks and uncertainties, and although the Company believes that the
expectations represented by such forward-looking statements are reasonable,
there can be no assurance that such expectations will be realized. Any number
of important factors could cause actual results to differ materially from
those in the forward-looking statements including, but not limited to, the
volatility of oil and gas prices, the ability to implement corporate
strategies, the state of domestic capital markets, the ability to obtain
financing, changes in oil and gas acquisition and drilling programs, operating
risks, production rates, reserve estimates, changes in general economic
conditions and other factors more fully described from time to time in the
reports and filings made by Cirrus with securities regulatory authorities.
The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release.
For further information:
For further information: David Taylor, President and Chief Executive
Officer; Pamela Orr, Vice President, Finance and Chief Financial Officer;
Cirrus Energy Corporation, Suite 350, 926 - 5th Avenue S.W. Calgary, Alberta,
T2P 0N7, Canada, Website: www.cirrusenergy.ca, Telephone: (403) 216-5030,
Facsimile: (403) 265-9530