FRANKFURT, Germany, May 25, 2011 /PRNewswire/ -- Terra Resources, PLC, a London, UK based independent oil and gas company listed on the Frankfurt Stock Exchange under the trading symbol "T31" ("Terra Resources") announced that it has engaged Baker Hughes (NYSE: BHI) to manage the development of its oil and gas assets in Russia.
Terra Resources and Baker Hughes have entered into a Master Services and Sales Agreement on April 21, 2011 and subsequently approved a work program for the next 4 to 6 months. The objective of the initial work program is to analyze all available data, produce reservoir studies, production forecasts and field development optimization models, develop performance and dynamic modeling, re-entry design, (casing inspection, and additional data acquisition program including but not limited to logging, sampling, and PVT analysis). Additionally, Baker Hughes plans to perform geomechanical modeling for surface completion design and production optimization, workover design (analysis of potential stimulation, re-perforation and side tracking), final subsurface completion design, and surface gathering system design and optimization.
"We are excited about working with Baker Hughes, as we begin to develop our oil and gas assets," stated Dmitriy Salop, Terra Resources' President. "Baker Hughes has performed a comprehensive data review, which enables it to construct a geological model, and move forward rapidly," explains, Mr. Salop. Baker Hughes and Terra Resources expect to start the field execution phase by or before November 2011.
About Terra Resources, PLC Terra Resources acquired substantial oil and gas concessions in the North Caspian Region - Kalmykia, Russia. The fields contain 64 wells, of which 62 were producing. The wells were capped and remained non-productive because of previous low gas prices and technology that could not handle the volume produced by high pressure wells. With new skilled management and an experienced operator, Terra Resources plans to open the wells again, and secure transportation via newly built gas and oil pipeline. Of the 62 producing wells, 7 are listed as potential "Super Giant" find based upon Subsalt discovery, outlined in the new 51-101 Competent Person's Report prepared by Chapman Petroleum Engineering, Ltd. This report concludes with a "best case" reserve estimate of the concession value at $7 to $11 Billion, with an estimated $175 million development costs over the life of the reserves.
About Baker Hughes Baker Hughes creates value from oil and gas reservoirs with high-performance drilling, evaluation, completions and production technology and services, integrated operations and reservoir consulting. Its solutions are designed to lower costs, reduce risk or improve productivity for the global oil and gas industry. Baker Hughes was formed in 1987 with the merger of Baker International and Hughes Tool Company—both founded over 100 years ago when R.C. Baker and Howard Hughes, Sr. conceived ground-breaking inventions that revolutionized the fledgling petroleum era.
Forward Looking Statements This press release contains forward-looking statements, which express the current beliefs and expectations of the management of Terra Resources, PLC. Such statements are based on current expectations and are subject to risks and uncertainties, many of which are beyond our control, and could cause future results, performance, and achievements to differ significantly from the results, performance or achievements expressed or implied by such forward-looking statements. Actual results could differ materially depending on a number of factors, and we caution investors not to place undue reliance on the forward-looking statements contained in this press release. These risks and uncertainties include, but are not limited to, economic conditions, the regulatory environment, loan concentrations, vendors, employees, technology, competition, and interest rates. Forward-looking statements speak only as of the date on which they are made and TERRA RESOURCES, PLC undertakes no obligation to update these forward-looking statements, even if new information becomes available in the future.
SOURCE Terra Resources, PLC