SOURCE: Coastal Energy Company

Coastal Energy Company

October 12, 2010 09:00 ET

Coastal Energy Announces Operations Update

HOUSTON, TX--(Marketwire - October 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.

The Bua Ban A-11 well was drilled to 4,500 feet true vertical depth and encountered 50 feet of net pay across two intervals in the Miocene reservoir with average porosity of 25%. The A-11 was an exploration well drilled to further establish productivity and potential trapping mechanisms in the Miocene. The A-11 is currently producing approximately 300 bopd with zero water cut.

The Bua Ban A-08 exploration well was drilled to test the northern limit of the Bua Ban field and encountered quality sands with some oil shows; however the sands were wet, suggesting that the well is at the down dip limit on the northern part of the structure. The well was subsequently completed as a water injection well. 

A further water injection well, the Bua Ban A-09, was drilled and completed prior to the departure of the rig from the Bua Ban location. During drilling of the A-09, 135 feet of the main source rock in the Lacustrine Shale was cored for continued evaluation of a non-conventional play. Initial core results are promising and final core analysis is expected in 8 to 10 weeks.

The rig has been mobilized to Songkhla A where two appraisal wells will be drilled into the Songkhla Oligocene Wedge and two appraisal wells will be drilled into the Eocene reservoir. The upgrade of the processing equipment at Songkhla A is expected to begin in mid-November.

Offshore production is currently 10,500 bopd and total combined production is approximately 12,500 boepd.

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

"We are pleased with the results of the A-11 well. Although the size of the Miocene closure at Bua Ban is small, establishing production from a 3-way closure in the Miocene is encouraging because we have nine other similar Miocene structures, several of which are lower risk 4-way traps, identified in the basin with combined recoverability estimates of over 50 mmbbl. 

"We are currently rigging up at Songkhla A and expect to spud the first Oligocene Wedge well early next week. Upgrades to facilities at Songkhla A should begin in November, and should stabilize production at Songkhla. Production at Songkhla continues to perform better than currently modeled. Following development drilling at Songkhla A, we plan to mobilize to Bua Ban North and begin exploration drilling in early December."

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

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
    Email: Email Contact
    +1 (713) 877-6793

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

    Stifel Nicolas Weisel (Broker)
    +44 (0) 20 3205 3615
    Paul Colucci

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

    Buchanan Communications
    Tim Thompson
    +44 (0) 20 7466 5000
    Katharine Sutton
    Ben Romney