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Palau Pacific Exploration Announces New Drilling Program in a Potential Billion Barrel World-Class Oil Reserve

Posted on: Tuesday, 19 May 2009, 09:02 CDT

Independent analysis of extensive science forms the basis for the initiative

HOUSTON, May 19 /PRNewswire/ -- Palau Pacific Exploration (PPX) has secured an option to farm into an approximate one million acre drilling concession on the North Block situated in the State of Kayangel in the Republic of Palau (the Prospect.). PPX is inviting investors to participate in a limited portion of the drilling program in an attempt to prove the existence of hydrocarbons in quantities that could potentially equal those of world-class giant oil fields. PPX is farming into a 75% Working Interest in the one million acre North Block. On completion of the farm-in, PPX and its shareholders will hold a 66% Net Revenue Interest.

The Prospect

The Prospect was defined by 140 miles of high-resolution seismic in 1997 that was reprocessed late in 2007 using cutting edge frequency dependent processing that resulted in the identification of multiple reefs and overlapping anomalies to drill. The Prospect is situated in approximately 130 feet of water, and drilling is expected to attain a total depth of 5,000 feet.

Reserve estimates indicate that the Prospect could have world-class giant oil field reserve potential. H.J. Gruy and Associates, in a specific, independent August 2008 report on the Prospect identifies two potential oil reservoir zones.

Science

Potential reservoirs, determined from seismic sequence stratigraphy, are thick Miocene age carbonate reef systems. Geochemical analysis confirms the presence of thermogenic hydrocarbons. Amplitude Vs Offset gradient analysis indicates shallow gas. Gruy estimates that there are shallow gas reserves that can likely be viewed as a bail-out option to attempt to recover costs should the discovery of oil not be successful, since there is a market to utilize the gas for power generation in Palau to replace costly imported diesel. Frequency-Dependent AVO indicates deeper hydrocarbons may be present. Gruy estimates economic production lives in excess of 20 years for the Miocene oil and Pliocene gas reserves.

Regional Setting

The Republic of Palau is located 500 miles east of the southern Philippine Islands, 500 miles north of New Guinea, and 800 miles southwest of Guam. The islands form a 300-mile-long archipelago made up of more than 200 islands, only nine of which are inhabited. Palau offers attractive concession terms to working-interest owners.

The Republic of Palau currently has a Compact of Free Association with United States whereby the United States supports Palau militarily.

PPX invites investors to participate in a private placement to raise euro 30 million to fund the drilling program. For further information contact Anglo Securities Limited regarding participation.

About Palau Pacific Exploration:

Palau Pacific Exploration (PPX) is an oil and gas exploration company focused on combining traditional exploration techniques along with new technologies to delineate promising high-impact frontier prospects offshore throughout the Republic of Palau.

PPX utilizes a full suite of exploration science to delineate prospect locations. PPX is an Australian company and is a capable and responsible operator with global and domestic US experience and have offices in Houston, Texas and Brisbane, Australia.

Additional details about PPX and the project are available at www.palaupe.com.

About Anglo Securities Limited:

Anglo Securities Limited (ASL) is the private investment banking arm of The Anglo Far-East Company. ASL is focused on identifying and bringing to life unique opportunities in the commodities, oil and gas, and agriculture markets that have the potential to provide ongoing opportunities by providing tangible assets and raw materials to a growing world. http://www.anglofareast.com/landing/ppx.html

SOURCE Palau Pacific Exploration

Source: PR Newswire

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