Serinus Energy Inc.

Serinus Energy Inc.

May 06, 2014 07:50 ET

Serinus Energy Inc./Ukraine: M-17 Tests Gas in S7 Zone, a New Pool Discovery

CALGARY, ALBERTA--(Marketwired - May 6, 2014) - Serinus Energy Inc. ("Serinus", "SEN" or the "Company") (TSX:SEN)(WARSAW:SEN), an international upstream oil and gas exploration and production company, is pleased to announce that the S7 zone in the Makeevskoye-17 ("M-17") well tested gas at a rate of over 0.9 million standard cubic feet per day ("MMcf/d") through a 7 millimetre choke.

The S7 has 5.5 metres of net pay and is a new pool discovery as it has not been previously produced elsewhere on the Company's licenses. Serinus currently carries no reserves for the zone. While logs had indicated the S7 as potentially hydrocarbon-bearing, stimulation had been deemed necessary to get a commercial rate, and consequently, the Company was pleasantly surprised by the test result. Stimulation is still being considered for the S7, and as such it remains in the campaign currently scheduled for October this year.

Gas samples taken during testing indicate that the gas has a carbon dioxide ("CO2") content of 8.8% and a heating value of 6,960 kilocalories per cubic metre ("kcal/m3"). While this is below the sales gas pipeline specification of 7,600 kcal/m3 and 2% CO2, it can be mingled with production from the Makeevskoye and Olgovskoye fields and the resulting blend will meet or exceed all pipeline requirements. Serinus is confident that the gas composition will not pose any material issues in development.

The plan now is to dually complete M-17 as an S6/S7 producer, with the S7 producing unstimulated. This will require the snubbing unit to avoid having to kill and potentially damage either formation. The snubbing unit is currently performing operations on the O-4 well. Until it arrives, M-17 will be suspended. A bridge plug will then be set above the S7, after which the S6 zone, which is the primary target in the M-17 well and 45 metres above the S7, will be perforated and tested. Wireline logs indicate 9 metres of net gas pay in the S6.

"The S7 test results are very encouraging, and potentially open up a new play in the Company's licences. We are also pleased that work is continuing uninterrupted through this stressful period in Ukraine, thanks to the efforts and dedication of our Ukrainian staff" - said Jock Graham, Executive Vice President and Chief Operating Office of Serinus.

M-17 was drilled to a total depth ("TD") of 3,475 metres in early March to appraise the gas discovery made in the S6 sandstone in M-16 well, which is currently producing at a rate of 3.9 MMcf/d. In addition to the S7 and S6 zones, wireline logs on M-17 indicate 2.5 metres of net pay in the S5 carbonates and 22 metres of resource potential in the R30c.

The M-17 well is operated by KUB-Gas LLC, a partially-owned subsidiary in which SEN has a 70% effective indirect ownership interest through its 70% shareholding of KUBGas Holdings Limited.

About Serinus

Serinus is an international upstream oil and gas exploration and production company with a diversified portfolio of projects in Ukraine, Brunei, Tunisia, Romania and Syria and with a risk profile ranging from exploration in Brunei, Romania and Syria to production and development in Ukraine and Tunisia. The common shares of the Company trade under trading symbol "SEN" on both the WSE (Warsaw Stock Exchange) and the TSX.

In Ukraine, Serinus owns an effective 70% interest in KUB-Gas LLC through its 70% shareholding of KUBGas Holdings Limited. The assets of KUB-Gas LLC consist of 100% interests in five licences near to the City of Lugansk in the northeast part of Ukraine. Four of the licences are gas producing.

In Tunisia, Serinus owns a 100% working interest in the Chouech Essaida, Ech Chouech, Sanrhar and Zinnia concessions, and a 45% working interest in the Sabria concession. Four of the concessions are currently producing oil or gas.

In Brunei, Serinus owns a 90% working interest in a production sharing agreement which gives the Company the right to explore for and produce oil and natural gas from Block L.

In Romania, Serinus has an undivided 60% working interest in the onshore Satu Mare concession, a 2,949 square kilometre exploration and development block, in north western Romania.

In Syria, Serinus holds a participating interest of 50% in the Syria Block 9 production sharing contract which provides the right to explore for and, upon the satisfaction of certain conditions, to produce oil and gas from Block 9, a 10,032 square kilometre area in northwest Syria. The Company has an agreement to assign a 5% ownership interest to a third party which is subject to the approval of Syrian authorities, and which, if approved, would leave the Company with a remaining effective interest of 45% in Syria Block 9. Serinus declared force majeure, with respect to its operations in Syria, in July 2012.

The main shareholder of the Company is Kulczyk Investments S.A., an international investment house founded by Polish businessman Dr. Jan Kulczyk.
For further information, please refer to the Serinus website (

Translation: This news release has been translated into Polish from the English original.

Forward-looking Statements This release may contain forward-looking statements made as of the date of this announcement with respect to future activities that either are not or may not be historical facts. Although the Company believes that its expectations reflected in the forward-looking statements are reasonable as of the date hereof, any potential results suggested by such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Various factors that could impair or prevent the Company from completing the expected activities on its projects include that the Company's projects experience technical and mechanical problems, there are changes in product prices, failure to obtain regulatory approvals, the state of the national or international monetary, oil and gas, financial, political and economic markets in the jurisdictions where the Company operates and other risks not anticipated by the Company or disclosed in the Company's published material. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties and actual results may vary materially from those expressed in the forward-looking statement. The Company undertakes no obligation to revise or update any forward-looking statements in this announcement to reflect events or circumstances after the date of this announcement, unless required by law.

Suite 1170, 700-4th Avenue SW, Calgary, Alberta, Canada

Telephone: +1-403-264-8877

Al Shafar Investment Building, Suite 123, Shaikh Zayed Road, Dubai, UAE

Telephone: +971-4-339-5212

Nowogrodzka 18/29, 00-511 Warsaw, Poland

Telephone: +48 (22) 414 21 00

Contact Information