Arsenal secures drilling rig for Egyptian program

Arsenal Energy Inc. announce that it, along with partners, has finalized a contract for a drilling rig (ECDC #2) that is scheduled to commence drilling operations on Arsenal’s 5.625 million acre Nuqra concession in Egypt in mid-February 2007.
Nuqra is a land-based concession located in the Upper Nile region in Egypt with rift basins that are analogous to highly prolific structures located to the East in Yemen, to the South in Sudan and to the North West in Libya which have yielded significant reserve and production volumes.
Arsenal anticipates drilling a minimum of two test wells to evaluate two independent prospects in the Nuqra Basin. The first well, SET-1, is planned to spud in February and drill to a target depth of 3800 feet and is targeting a structure with Jurassic sands. The second well, NARMER-1, which is planned to be drilled to a target depth of 7800 feet, is located approximately 17 miles from the SET-1 and is targeting a structure with Berriasian and Kimmeridgian sands.
Extensive 2-D seismic programs have defined the SET-1 and NARMER-1 prospects and both drilling locations have road access on dry land. Drilling of the two wells is expected to take approximately 90 days. Arsenal will pay 40 percent of the drilling costs and will retain a 30 percent working interest, plus a partial cost recovery, after a commercial discovery. The operator estimates that the two initial target structures could contain up to 40 million barrels of oil equivalent in recoverable reserves.
Arsenal and its’ partners have a third contingent location that would test another independent structure approximately 4 miles from the NARMER-1 location, which is in the process of being approved by the Egyptian government. If Arsenal and its partners elect to drill this location, it is expected the ECDC #2 rig will move to this location in the late second or early third quarter of 2007.
(Oil Egypt)


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