Vangold Resources Ltd.
TSX VENTURE : VAN

Vangold Resources Ltd.

September 23, 2005 14:32 ET

Vangold Announces Sarcee Well Completed and Tested

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Sept. 23, 2005) - Vangold Resources Ltd. (TSX VENTURE:VAN) ("Vangold") reports that partners, C1 Energy Ltd, ("C1") and Arapahoe Energy Corp. ("Arapaphoe") have provided a joint update with respect to the C1 et al. Sarcee 12-13-23-4W5M exploration well.

C1 is pleased to announce that it has now completed drilling and a preliminary test of the Sarcee 12-13-23-4W5M well. It was drilled to a depth of 3,254 metres and intermediate casing was set to 3,160 metres. Immediately below this depth, the well encountered a 70-metre gross (48-metre net) interval with a 5-per-cent average porosity in the primary target being the Turner Valley formation, which is fully dolomitized. The well has been preflowed in an open-hole condition to verify the presence of natural gas and to determine if the well requires stimulation.

Based on this preliminary information provided by C1 as operator, Sproule Associates Ltd. has determined that a gas pool has been encountered, and estimates that the original gas in place of this pool could be between 20 billion standard cubic feet to 30 billion standard cubic feet. At this time, it appears no previous production has been established from this pool. Similar gas pools in the area are high deliverability, hydrocarbon liquids-rich and demonstrate long reserve life indices.

This initial estimate is based on the well logs and the preliminary test information, together with areal extent approximated from 3-D seismic. Original gas in place is not a reserve classification. The determination of recoverable reserves will be done after other factors are determined from further tests and future production performance. Original gas in place is assigned to the pool, and may require more than one wellbore to effectively drain this pool.

The well requires selective acid stimulation and C1, as the operator, is in the process of procuring a service rig, equipment and services. This is standard completion procedure for similar wells in this area. This is to be followed by a full production test to determine the wells poststimulation productive capability. Due to equipment and labour availability, it is anticipated that these operations may be delayed for two or three months.

In accordance with the farm-out agreement, C1 funds 25 per cent of the costs associated with the drilling and completion of the well and retains a 55-per-cent working interest. Vangold's interest in the test is 10% BPO and 6% APO.

Vangold now has earned a 6% undivided working interest in the four sections (2560 acres) over this project area. Evaluation of 3-D seismic over these lands has identified the structural feature verified by the current 12-13 discovery as well as two to three development locations on this structure. A second prospective structure has been identified on the lands that will be further evaluated for its exploratory potential.

Vangold has ongoing revenues from its interests in the East Corning Field in the Sacramento Basin, California and Killam Oil Field in Alberta, Canada. Vangold is continuing its aggressive development program for its oil and gas interests. Presently, Vangold has one oil and gas drilling project underway in Texas, one in California and seven in Alberta. In addition to oil and gas investments, Vangold is one of the dominant gold exploration companies in Papua New Guinea and currently holds interests in six gold projects and one copper/gold project. Most of these properties are considered advanced stage projects with significant known gold in trench and drill hole with further drill ready targets. The properties total 1,700 sq kms in area. Vangold has also entered into an option agreement to earn a 100% interest in four copper-cobalt prospects in Uganda.

On Behalf of the Board of

VANGOLD RESOURCES LTD.

Dal Brynelsen, President and CEO


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