Oryx Petroleum Announces Successful Oil Discovery at Zey Gawra in the Kurdistan Region of Iraq

Third Consecutive Discovery in Hawler License Area Flows at 4,800 Barrels Per Day

CALGARY, Dec. 4, 2013 /CNW/ - Oryx Petroleum Corporation Limited ("Oryx Petroleum" or the "Corporation") today announces the successful discovery at Zey Gawra in the Hawler license area.. The ZEG-1 well was flow tested at an average rate of 4,800 barrels per day of light crude oil from an 81 metre column.  A Notice of Discovery has been filed by the Corporation with the Kurdistan Region Government. Oryx Petroleum is the operator and has a 65% participating and working interest in the Hawler license area.

Commenting today, Henry Legarre, Oryx Petroleum's Chief Operating Officer, stated:

"Hawler is proving to be a prolific license area. We are very pleased to have made our third consecutive oil discovery there this year, achieving excellent flow rates of high quality crude from the Cretaceous. More work needs to be done to confirm the size of the discovery but we believe it will be substantially larger than our pre-drill estimates.  Importantly, the reservoir characteristics in the Cretaceous, notably the matrix porosity, confirm our experience with the other wells we have drilled in the Hawler license area. We are already planning our first Zey Gawra appraisal well and we are confident that the discovery will be established as commercial."

Testing Program and Results

The KS Discoverer rig spudded the ZEG-1 well in April 2013 targeting the Zey Gawra prospect, an anticline lying on the Kirkuk field trend that is the last closure to the northwest of the Khurmala Dome.  The ZEG-1 well targeted oil potential in the Cretaceous, Jurassic and the Triassic. Netherland Sewell & Associates, Inc. estimated as of March 31, 2013 that the Zey Gawra prospect contained 23 MMbbl of unrisked gross (100%) prospective resources (risked: 9 MMbbl). ZEG-1 reached a total depth of 4,398 metres in August when the KS Discoverer rig was moved to spud Banan. The smaller Romfor 22 rig was then brought in to conduct the testing.

The ZEG-1 well was logged down to the Triassic and there were oil shows of varying quality in the Cretaceous and the Upper and Lower Jurassic.  As such, four cased hole drill stem tests ("DST") were conducted including two in the Lower Jurassic, one in the Upper Jurassic and one in the Cretaceous.

The DST conducted in the Cretaceous tested the Shiranish, Kometan and Qamchuqa intervals which are considered to form one continuous reservoir. The Cretaceous DST was successfully flowed at sustained rates in intervals over a period of four days using a series of different choke sizes. The maximum average rate achieved was approximately 4,800 bbl/d of light oil for a 15 hour period using a 64/64" choke. No pressure decline was observed during the tests. The crude from the Cretaceous was measured on site at 35° API gravity. Small quantities of natural gas and hydrogen sulfide were encountered.

The 81 metre oil column in the Cretaceous was successfully established between the free water level, as evidenced by Modular Formation Dynamics Tester ("MDT") measurements, and the top of the interval perforated for testing.  This oil column includes a 64 metre section in the Qamchuqa. As with the Demir Dagh test in the Cretaceous, the matrix porosity in the Qamchuqa, evidenced by logs and core samples, was significantly better than the Corporation had expected.  The 106 metre section of the Shiranish above the established oil column, may also contain oil, however the ZEG-1 well did not encounter matrix porosity or evidence of a fracture network in this interval.  The potential oil bearing nature of the Shiranish will be further evaluated as part of the appraisal program.

The DST conducted in the Upper Jurassic tested the Najmah formation which has a thickness of approximately 750 metres. Without the use of a pump, the well flowed what appears to be very heavy oil to surface on a non-continuous basis over a 14 hour period. The quality of the oil could not be measured properly on site and samples will be analyzed to better assess potential in the Najmah.  The results of the Najmah DST were similar to the Najmah DST conducted at Demir Dagh.

The DSTs conducted in the Lower Jurassic tested the Mus and Adayiah formations separately. While logging results of each formation indicated the presence of fractures, the results of both tests were inconclusive as the tests were unable to connect to a permeable fracture network and flow fluids to surface.

The data gathered from the well and field tests should be considered preliminary until such time as a pressure transient analysis or well-test interpretation has been carried out. Test results are not necessarily indicative of long-term performance or of ultimate recovery .

Appraisal Plans and Conceptual Development

Oryx Petroleum is conducting further analysis of the ZEG-1 well and intends to drill an appraisal well at Zey Gawra in 2014 as part of the multi-well appraisal and development drilling program in the Hawler license area. Depending upon the ultimate size of the Zey Gawra discovery, the field could be tied into the Corporation's planned development at Demir Dagh or developed on a standalone basis.

ABOUT ORYX PETROLEUM CORPORATION LIMITED

Oryx Petroleum is an international oil exploration company focused in Africa and the Middle East. The Corporation`s shares are listed on the Toronto Stock Exchange under the symbol "OXC". The Oryx Petroleum group of companies was founded in 2010 by The Addax and Oryx Group Limited and key members of the former senior management team of Addax Petroleum Corporation. Oryx Petroleum has interests in six license areas, two of which have yielded oil discoveries and four of which are prospective for oil. The Corporation is the operator or technical partner in four of the six license areas. Two license areas are located in the Kurdistan Region and the Wasit governorate (province) of Iraq and four license areas are located in West Africa in Nigeria, the AGC administrative area offshore Senegal and Guinea Bissau, and Congo (Brazzaville). Further information about Oryx Petroleum is available at www.oryxpetroleum.com or under Oryx Petroleum's profile at www.sedar.com.

Reader Advisory Regarding Forward-Looking Information

Certain statements in this news release constitute "forward-looking information", including statements related to the Corporation's reserves and resources estimates and potential, drilling plans, development plans and schedules and chance of success, results of exploration activities, future drilling of new wells, ultimate recoverability of current and long-term assets, possible commerciality of our projects, future expenditures, and statements that contain words such as "may", "will", "could", "should", "anticipate", "believe", "intend", "expect", "plan", "estimate", "potentially", "project", or the negative of such expressions and statements relating to matters that are not historical fact, constitute forward-looking information within the meaning of applicable Canadian securities legislation.

In addition, information and statements in this news release relating to reserves and resources are deemed to be forward-looking information, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves and resources described exist in the quantities predicted or estimated, and that the reserves and resources described can be profitably produced in the future. See "Reserves and Resources Advisory" below.

Although Oryx Petroleum believes these statements to be reasonable, the assumptions upon which they are based may prove to be incorrect. In making certain statements in this news release, Oryx Petroleum has made assumptions with respect to the following: the general continuance of the current or, where applicable, assumed industry conditions, forecasts of capital expenditures and the sources of financing thereof, timing and results of exploration activities, the Corporation's ability to obtain and retain qualified staff, contractors and personnel and equipment in a timely and cost-efficient manner, the political situation and stability in jurisdictions in which Oryx Petroleum has licenses, the ability to renew its licenses on attractive terms, the applicability of technologies for the recovery and production of the Corporation's oil reserves and resources, the amount, nature, timing and effects of capital expenditures, geological and engineering estimates in respect of the Corporation's reserves and resources, the geography of the areas in which the Corporation is conducting exploration and development activities, operating and other costs, and business strategies and plans of management.

Forward-looking information is subject to known and unknown risks and uncertainties which may cause actual results or events to differ materially from those anticipated in the forward-looking information and statements if the assumptions underlying them prove incorrect, or if one or more of the uncertainties or risks described below materializes.  The risks and uncertainties affecting the Corporation include, but are not limited to, imprecision of reserves and resources estimates; ultimate recovery of reserves; ability to commercially develop its oil reserves and/or its prospective and contingent oil resources; commodity prices; general economic, market and business conditions; industry capacity; competitive action by other companies; refining and market margins; the ability to produce and transport crude oil and natural gas to markets; weather and climate conditions; results of exploration and development drilling and other related activities; fluctuation in interest rates and foreign currency exchange rates; ability of suppliers to meet commitments; actions by governmental authorities, including increases in taxes; decisions or approvals of administrative tribunals, renewal or granting of licenses; changes in environmental and other regulations; international political events; renegotiations of contracts; reliance on key managers and personnel; dry wells may lead to a downgrading of the Corporation's licenses or contracts or require further funds to continue exploration work; future foreign currency exchange rates; risks related to the actions and financial circumstances of our agents and contractors, counterparties and joint venture partners; political uncertainty, including actions by terrorists, insurgent or other groups, or other armed conflict, including conflict between states; and expected rates of return.  More specifically, future production may be affected by exploration success, start-up timing and success, facility reliability, reservoir performance and natural decline rates, water handling and drilling progress, restrictions on ability to access necessary infrastructure, equipment and services, including but not limited to, those sourced from third party providers.  Capital expenditures may be affected by cost pressures associated with new capital projects, including labour and material supply, project management, drilling rig rates and availability and seismic costs. Risk factors are discussed in greater detail in filings made by the Corporation with Canadian securities commissions.

Readers are strongly cautioned that the above list of factors affecting forward-looking information is not exhaustive.  Although the Corporation believes that the expectations conveyed by the forward-looking information are reasonable based on information available to it on the date such forward-looking information was made, no assurances can be given as to future results, levels of activity and achievements. Readers should not place undue importance or reliance on the forward-looking information and should not rely on the forward-looking information as of any date other than the date hereof.  Further, statements including forward-looking information are made as at the date they are given and, except as required by applicable law, Oryx Petroleum does not intend, and does not assume any obligation, to update any forward-looking information, whether as a result of new information or otherwise.  If the Corporation does update one or more statements containing forward-looking information, it is not obligated to, and no inference should be drawn that it will make additional updates with respect thereto or with respect to other forward-looking information.  The forward-looking information contained in this news release is expressly qualified by this cautionary statement.

Reserves and Resource Advisory 

Oryx Petroleum's reserves and resource estimates have been prepared and audited in accordance with National Instrument 51-101 - Standards of Disclosure for Oil and Gas Activities and the Canadian Oil and Gas Evaluation Handbook.

Prospective oil resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective oil resources have both a chance of discovery and a chance of development. There is no certainty that any portion of the prospective resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the prospective resources.

 

SOURCE: Oryx Petroleum Corporation Limited

Craig Kelly
Chief Financial Officer
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Scott Lewis
Head of Corporate Finance
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