Sky Petroleum, Inc. provided an update on its business and operations at the First U.S. Albania Investment Forum in New York.

Sky Petroleum reported that it engaged a consulting team on August 22, 2011 to make field development recommendations for the comapny's Albanian prospects. A technical team led by Tim Parson, formerly Occidental Oil Co., analysed technical data and made recommendations for three of the ten Sky Petroleum prospects in Albania. Based on the analysis, oil shows in Palokastra indicate potential for further drilling "up-dip" and oil shows in Kanina show potential for further testing of fractured intervals independently and with more detailed isolation. Sky Petroleum G&G is in the process of refining exploration plans.

Summarizing the data, Dumre has deepening potential given that a VSP at 6,015m showed "potential seismic reflector at 6,250m" in 1995. TD is 6,119m in 5-3/4" hole and 7" casing cement channelled up to ~800m restricting 7" cut-and-pull options to drill greater than 5-3/4" side-track around top-of-fish at 5,942m but there is potential to drill a 5-3/4" side-track for geological information that will reach carbonates and prove a reservoir for later development. Seismic unreliability through salt has made predicting top carbonate difficult historically. Further detailed planning with G&G, contractors and service companies is priority for Sky Petroleum.

Exploration Blocks Four, Five, and Dumre

The PSC has a seven-year term with three exploration periods. Upon commercial discovery of gas, the agreement allows for development and production periods of 25 years plus extensions at the Company's option. Block Four is located in southeast Albania, bordering on Greece; Block Five is located in southwest Albania next to the Adriatic Sea; and Block Dumre is located immediately north of the Kucova oil field. Based on analogous discoveries, it is believed that the prospects contain significant hydrocarbons.

Tags: Sky Petroleum