SOURCE: Coastal Energy Company

Coastal Energy Company

July 12, 2010 16:15 ET

Coastal Energy Announces Operations Update

HOUSTON, TX--(Marketwire - July 12, 2010) -  Coastal Energy Company (the "Company" or "Coastal") (TSX-V: CEN) (AIM: CEO), an independent exploration and production company with assets in Thailand, announces an update of its operations in the Gulf of Thailand.

Bua Ban

The Bua Ban A-01, A-02 and A-05 wells have been completed using electric submersible pumps ("ESPs") and tied into production facilities. Combined production from the three wells is averaging 3,000 bopd. The oil being produced is sweet and has API gravity of 30 degrees. 

The Bua Ban A-03 well has reached total depth of 8,650 feet TVD. It was drilled off structure to test the lower limits of the Lower Oligocene oil column. The well encountered 20 feet of net pay in a Lower Oligocene section which is 310 feet below the previous lowest known oil point. Additionally, the well encountered 24 of net pay with 20% average porosity in the higher Miocene section at approximately 3,400 feet TVD. The oil tested from the Miocene formation is sweet and has API gravity of 34 degrees. The Company is evaluating the future prospectivity of this play.

Benjarong

The Benjarong A-01 and A-02 wells have been completed and flow tested at uncommercial rates. The Company is evaluating the cost and probability of success of fracture stimulation.

Songkhla A

The four wells at Songkhla A continue to perform in line with modelled rates. Production at Songkhla A is currently averaging between 8,000 - 8,500 bopd.

The Company's total offshore production is now approximately 11,000 bopd. Total combined production, including 2,000 boepd from Sinphuhorm, is approximately 13,000 boepd.

Randy Bartley, Chief Executive Officer of Coastal Energy, commented:

"The initial test results at Bua Ban are encouraging. Production from the A-05 well is higher than was anticipated in the original development plan. The new Miocene play seen in the A-03 well is exciting as it is the first time that productive Miocene sands have been encountered in Block G5/43. This discovery has significant potential for future appraisal and development. We continue to expect the current development at Bua Ban to bring further success and increases in production." 

Randy Bartley, President and Chief Executive Officer of the Company and a member of the Society of Petroleum Engineering and Jerry Moon, Vice President, Technical & Business Development, a member of the American Association of Petroleum Geologists, a Licensed Professional Geoscientist and a Certified Petroleum Geologist in the state of Texas, have reviewed the contents of this announcement.

Additional information, including the Company's complete competent person's report may be found on the Company's website at www.CoastalEnergy.com or may be found in documents filed on SEDAR at www.sedar.com.

This statement contains 'forward-looking statements' as defined by the applicable securities legislation. Statements relating to current and future drilling results, existence and recoverability of potential hydrocarbon reserves, production amounts or revenues, forward capital expenditures, operation costs, oil and gas price forecasts and similar matters are based on current data and information and should be viewed as forward-looking statements. Such statements are not guarantees of future results and are subject to risks and uncertainties beyond Coastal Energy's control. Actual results may differ substantially from the forward-looking statements.

These securities have not been registered under United States Securities Act of 1933 (the "US Securities Act") or the securities laws of any state and may not be offered or sold in the United States or to US persons (as defined in Regulation S under the US Securities Act) unless an exemption from registration is available.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

This news release is not for dissemination in the United States or through United States newswire services

Contact Information

  • Enquiries:

    Coastal Energy Company
    Randy L. Bartley
    Chief Executive Officer
    +1 713 877 6705
    William C. Phelps
    Chief Financial Officer
    +1 713 877 6727
    Email: Email Contact

    Strand Hanson Limited (Nominated Adviser)
    +44 (0) 20 7409 3494
    Rory Murphy
    Paul Cocker

    Thomas Weisel Partners (Broker)
    +44 (0) 20 3205 3615
    Paul Colucci

    Macquarie Capital (Europe) Limited
    (Broker)
    +44 (0) 20 3037 2000
    Ben Colegrave
    Paul Connolly

    Buchanan Communications
    +44 (0) 20 7466 5000
    Tim Thompson
    Catherine Breen
    Katharine Sutton