Premier Energy reports its engagement in oil production in Russia through its majority-owned subsidiary Karbon CJSC, which is the holder of the oil and gas exploration and production license for the North-Kopanskoye Oilfield in the Volga-Urals Basin.

The North-Kopanskoye Oilfield covers an approximate area of 3,213 acres and lies about 34 miles southeast of the city of
Orenburg and 18 miles south of the Orenburg gas-condensate field. The North-Kopanskoye Oilfield contains two structurally-trapped, carbonate reservoirs, the Pennsylvanian Bashkirian A-4 and Permian Artinsky-1. The Bashkirian A-4 reservoir accumulated oil on two of the four individual domes in the Oilfield. The Artinsky-1 reservoir has a larger accumulation of oil with an associated gas cap, and a separate non-associated gas accumulation.

According to DeGolyer and MacNaughton’s appraisal report of 2007, as concluded from the results of over a dozen exploration wells drilled in 1980s, we believe that the North-Kopanskoye Oilfield includes proved oil reserves of about 8 million barrels. The report also indicates additional probable oil reserves of about 21 million barrels (not risk adjusted); however, a new seismic survey and additional drilling are needed to support the probable reserves.

Five of the exploration wells were subsequently completed and produced, but later shut in due to needed work-over. The only presently producing well in the North-Kopanskoye Oilfield is a development well drilled and completed in 2006, with a current production rate of over 60 barrels of oil per day (BOPD).

Tags: Premier Energy Corp.