Dear Sir DRILLING ACTIVITY ANNOUNCEMENT The COG Mailisu III #2 well will commence drilling on Friday, November 9, 2007. The well will test oil targets in the Palaeogene and gas targets in the Jurassic. The well is Caspian’s second in its planned eleven well drilling programme in the northern Fergana Basin, Kyrgyz Republic. The well will be drilled to a depth of about 1,500m in the Mailisu III block (outside the Santos joint venture area). Details Well Name Caspian Interest Type Location (Tenement) Latitude / Longitude Drill Depth Expected Spud Date Current Activity COG Mailisu III #2 70% Oil / Gas appraisal Mailisu III Block 41.257008° / 72.455423° 1,500m 9/11/2007 Preparing to Spud Background Oil – The COG Mailisu III #2 will further test the reservoir potential within the Mailisu III oil field. The well is located in the northern portion of the Mailisu III licence some 400m south of recent discovery at COG Mailisu III #1 (see figure). The main reservoir targets are Beds V & VII which proved oil bearing in the #1 well. Gas - The Mailisu III gas field produced some 30Bcf reserves before local flowline infrastructure was damaged by a landslide causing the field to cease production. A review of the production history indicates that there is between 1 and 5Bcf remaining reserves which would require compression to be produced. The previous customer, located within the Mailisu township, still has gas requirements and sales could resume should commercial reserves be proven, potentially providing up to 5 years supply. Update COG Mailisu III #1 The Mailisu III #1 well has confirmed the extent of the oil field in the northern direction as well as providing information on the reservoir quality. Of the main target zones, Bed VII has around 2m net pay zone of good porosity (up to 20%). Oil was recovered from the well during the cementing of the casing, confirming our expectations of the production potential of the well. As soon as the necessary equipment is available, the well will be perforated and a production test carried out.
CIG Price at posting:
0.0¢ Sentiment: Buy Disclosure: Held
