DALLAS, March 29 /PRNewswire-FirstCall/ -- International TME Resources Inc. announces that the operator of VIC/P54, Nexus Energy Ltd. has rejected a hostile $171 million takeover bid from Anzon Australia Ltd, describing it as inadequate. Nexus has become hot property because of the fast-maturing status of its key developments -- the Longtom Gas Field on VIC/P54 in the Bass Strait, located on TME's ORRI and one other project in the Timor Sea.
The Longtom Gas Field is located in the Gippsland Basin and was discovered by BHP in 1995, but was considered sub-commercial (70-120bcf) at the time due to the lack of maturity of the gas markets and the interpreted reservoir quality. A 386+ meter gas column was intersected in the Emperor Formation in Longtom-1.
Longtom-2 was drilled in late 2004. A 400+ meter gas column was confirmed within the structure. The lower reservoir section in Longtom-2 flowed at a stabilized rate of 18-19 mmcf/day over a 12 hour period -- an excellent result confirming the commercial potential of the previously untested lower reservoir section in Longtom. The upper reservoir section did not flow gas to surface -- two third party engineers confirmed a subsurface test valve did not open; hence the well could not flow against the closed valve. A core from the upper reservoir section was taken and analyzed, confirming an excellent reservoir section highly capable of flowing gas. No gas-water contact has been intersected at Longtom to-date, suggesting deeper reservoir potential exists.
While Longtom-2 pointed to mechanical problems as the cause of poor flow rates from the main reservoir, seismic reprocessing and amplitude variation with offset (AVO) work indicates a strong gas anomaly in these sands as well as an untested anomaly in sands above the primary zone. Thus, Longtom-3 will be a multi-purpose appraisal seeking confirmation of the lateral extent of the lower reservoir as well as exploration of the anomaly higher in the stratigraphic column.
A good result from Longtom-3 would clarify the independent assessment from Gaffney Cline & Associates for the Longtom Gas Field to possibly contain estimated reserves of 316 billion cubic feet and possibly add a further 250 billion cubic feet, which at the moment is listed as possible in the upper reservoir.
TME's ORRI under VIC/P54 is located in the prolific Gippsland Basin of the Bass Strait and consists of 155,676 gross acres.
$44.2 Million Raised by Operator - Drilling Longtom-3 by June 06
TME is pleased to announce that the Joint Venture Partners of the offshore VIC/P54 have successfully raised $44.2 million. A portion of the capital raised will enable the operator to rapidly progress the commercialization of the Longtom Gas Field. The Longtom field contains an estimated 316 BCF of recoverable gas. The Longtom-3 well is expected to drill by May or June of 2006 at an estimated drilling and completion cost of approximately $A35,000,000.
About The Gippsland Basin:
In excess of 4 billion barrels of oil/condensate and 12 TCF gas reserves have been discovered in the Basin since exploration drilling began in 1964, with remaining reserves estimated at 600 million barrels of oil and 5 trillion cubic feet of gas. Current production of the basin is around 140,000 barrels per day of crude and 570 million cubic feet per day of gas. At peak rates, the Gippsland Basin can deliver more than 1,000 million cubic feet a day.
Contract Signed With Santos to Sell 320 BCF of Gas on VIC/P54
TME is also pleased to announce that the operator of VIC/P54 has signed the Longtom Gas Sales and Toll Processing Agreement with Santos. The agreement will enable the operator of VIC/P54 to process and sell up to 350 BCF of gas of gas over 12 years (with an option for additional 91 BCF of gas) from the Longtom Gas Field located in Bass Strait on TME's ORRI.
The gas from VIC/P54 will be processed through Santos existing Patricia Baleen facilities near Orbost in Victoria. This deal provides commercial certainty for the commercialization of the Longtom Gas Field and provides an optimal development solution by minimizing the cost and risk of the development.
The Longtom Gas Sales Agreement with Santos is conditional on the successful completion of the Longtom-3 appraisal well and the operator of VIC/P54 is confident that this will be achieved.
Upon a successful completion of Longtom-3, the first gas is anticipated to flow from the Longtom Gas Field by mid 2008. Preliminary engineering studies suggest 2 wells (Longtom-3 and 4) will be sufficient to drain the contracted 320 BCF gas. Further development wells would be required for reserves beyond this. The wells will be completed sub-sea, connected via a manifold and piped 12km to Patricia Baleen facilities. Santos will process and purchase the gas from this point. The gross estimated capital expenditure is expected to be approximately $A160 million, including the cost of drilling and completing the Longtom-3.
Summary
TME anticipates that Longtom will prove to be a substantial resource capable of delivering significant long term cash flow and value. The drilling of the Longtom-3 development well should prove to be an exciting event in TME's company history.
About TME:
The company has royalty interests in more than 4,651,695 acres located in two-world class petroleum basins in Australia, the Cooper-Eromanga Basin and the Gippsland Basin. Financial and management assets are currently being concentrated in acquiring additional acreage in its multi-million barrels of oil field potential in Texas named the Mega-West Field.
International
Substantial holdings have been acquired in two world class petroleum basins. The Cooper-Eromanga Basin (Onshore) located in the state of South Australia and the Gippsland Basin (Offshore) located in the Bass Straits and offshore to the State of Victoria.
Offshore
The Company has acquired royalty holdings in 370,572 acres in the Gippsland Basin. This Basin contains some of the largest fields in the world and wells that are world record Producers. One well in the Halibut Field has produced 60 million bbls. of oil -- a world record. Many TCF of natural gas have been produced from fields in this Basin.
Onshore
The Company has acquired royalty interest holdings in 4,281,123 acres in the Cooper-Eromanga Basin. To date, this Basin has produced a total of 11 Trillion cubic feet of natural gas and 450 million barrels of oil have been discovered. Since the first gas discovery in 1963, a total of 123 gas fields and 58 oil fields have been discovered.
For the Board
Allen White, President
International TME Resources Inc.
6370 L.B.J. FRWY., Suite 174
Dallas, TX 75240
972.458.7013 ph
Symbol: ITME
Web: http://www.tmeresources.com/
Disclaimer:
This document contains forward-looking statements within the meaning of Section 21 E of the Securities and Exchange Act of 1934, as amended. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ for reasons that include but are not limited to political and economic conditions in the countries in which the Company does or intends to do business, regulatory action, product pricing, change in drilling schedules and competitive market conditions. These forward-looking statements represent the Company's best judgment at the date of this document and any changes in assumptions or external factors could produce significantly different results.
