Sacoil has Positive Update for Lagia Oil Field

SacOil Holdings Limited, on behalf of its subsidiary, Mena International Petroleum Company Limited ("Mena"), is pleased to announce an update on the drilling of the Lagia 11, Lagia 15 and Lagia 16 wells, which forms part of the Phase 2 field development operations at its 100% owned Lagia oil field in Sinai, onshore Egypt.

As reported previously, the Lagia 11, Lagia 15 and Lagia 16 wells are part of a five well drilling campaign aimed at increasing and optimising production. The remaining wells to be drilled are Lagia 12 and 13, which will target the Nukhul formation.

SacOil is pleased to announce that Lagia 11 was drilled to a depth of 1,434 ft below drill floor and encountered approximately 213 ft of gross oil bearing Nukhul formation. The well was placed in production and is producing oil with a gravity of 13 degrees API.

Lagia 15, the second well in the programme, was drilled to a depth of 1,820 ft below drill floor. The well intersected the Nukhul formation as well the Thebes formation and discovered producible oil in both formations. Preliminary results indicate that the discovery in the Thebes formation is of a higher API gravity as compared to the oil produced from the Nukhul formation in this field. Preliminary results also indicate that the API gravity of the Thebes is above 24 API gravity. Further analysis of the Thebes discovery will be concluded before Lagia 15 is placed in production.

Lagia 16, the third well in the programme was drilled to a depth of 1,430 ft below drill floor and encountered 213 ft of gross oil bearing and potentially productive Nukhul formation and the well will be placed in production. The oil intersected in Lagia 16 is expected to have similar API gravity to the main producing Nukhul formation.

SacOil is now monitoring each of these wells and evaluating the potential of applying stimulation techniques with a view to optimising flow rates and achieving stabilised flow rates and production profile for the Lagia Block. Further announcements will be made in this regard in due course.

Dr Thabo Kgogo, Chief Executive Officer of SacOil, commented, "The discovery of a light oil in the Thebes formation is very significant for the Lagia assets and for SacOil as a company. This discovery should add to the field reserves and may add to production from the Lagia field in the future.

The focus for our technical team now is to further evaluate these well results to establish a better understanding of the potential stabilised production rates from each well and the field as a whole. We are certainly pleased with these initial results and look forward to the commencement of our Lagia 12 and 13 wells. We remain on track to deliver on our previously stated production milestone of 1,000bopd by our financial year end.

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