HARBIN, China and NEW YORK, Oct. 28, 2011 /PRNewswire-Asia/-- China North East Petroleum Holdings Limited (the "Company") (NYSE Amex: NEP), a leading independent oil producing and oilfield services company in Northern China, today announced that it has completed the seismic testing of its Durimu oilfield.
China North East Petroleum acquired Sunite Right Banner Shengyuan Oil and Gas Technology Development Co., Ltd. ("Shengyuan") in January 2011. Shengyuan is an operator with exclusive oilfield exploration and drilling rights in the Durimu oilfield in Inner Mongolia. Upon the close of NEP's acquisition of Shengyuan, the Company engaged Hunan Province Mining Geological Bureau Physical Exploration and Survey Team, an independent geological survey partner in early July 2011 and conducted seismic survey work in Durimu from July 20th to September 28th, 2011. The preliminary results show:
- Four targeted cap layers from top to bottom, including the Saihantala formation (k1bs), Tenggeer formation second member (k1bt2), Tenggeer formation first member (k1bt1) and Aershan formation (k1ba).
- The main oil and gas reservoir bed in this area, consisting of the Tenggeer formation second member (k1bt2) and Tenggeer formation first member (k1bt1) are particularly good. The depth of burial is up to 1,800-2,000 meters, which is extremely favorable to the formation and storage of oil and gas.
- In the cooperated blocks, the structural framework has the feature that the northern part is higher than the southern part and the reflection of the integral structure is clear. The cap layer which reserves the oil and gas has good continuity which meets the requirement to have an oil reserve of large amount.
These results are preliminary and the final comprehensive seismic report is expected to be completed by December 2011. The Company will provide more details regarding the data from its seismic test in the future once it receives the final report.
Mr. Jingfu Li, CEO of China North East Petroleum commented, "We are pleased to announce that the seismic testing work in Durimu oilfield has been successfully completed in the third quarter and based on initial data, we are encouraged to see positive preliminary results. Currently, our in-house engineering team is working with our geological survey consultant to develop a preliminary test drilling plan. We plan to commence initial test drilling in the fourth quarter and expect test drilling to last approximately 12 to 18 months. As we've stated in recent months, during this 12 to 18 month test drilling period, any oil produced will be sold to qualified buyers, which will generate revenue and cash flow to further support the Durimu oilfield exploration program. Once the initial test drilling stage is complete, we intend to increase the pace of drilling in Durimu with an expected overall increase in production, which will in turn generate greater revenue and cash flow. We look forward to further discussing our operations and latest developments when we announce our third quarter earnings results."ABOUT CHINA NORTH EAST PETROLEUM China North East Petroleum Holdings Limited is an independent oil company that engages in the production of crude oil in Northern China. The Company is a pioneer in China's private oil exploration and production industry, and the first Chinese non-state-owned oil company trading on the NYSE Amex. The Company has a guaranteed arrangement with the PetroChina to sell its produced crude oil for use in the China marketplace. The Company currently operates five oilfields in Northern China. The Company also recently obtained exploration and drilling rights in the Durimu oilfield through its acquisition of Sunite Right Banner Shengyuan Oil and Gas Technology Development Co., Ltd. ("Shengyuan"). For more information about the Company, please visit http://www.cnepetroleum.com Statements in this press release, including but not limited to those relating to the Company ' s or management ' s intentions, beliefs, expectations, hopes, projections, assessment of risks, estimations, plans or predictions for the future, including the impact of the restatement, timing of filings with the SEC and other statements that are not historical facts are forward-looking statements that are based on current expectations. Statements regarding our ability to realize future production volumes, realize success in our drilling and development activity and forecasts of legal claims, prices, future revenues and income and cash flows and other statements that are not historical facts contain predictions, estimates and other forward-looking statements. Although the Company believes that its expectations are based on reasonable assumptions, it can give no assurance that these expectations will prove correct. Important factors that could cause actual results to differ materially from those in the forward-looking statements include delays and uncertainties that may be encountered in connection with seismic testing and test drilling in the Durimu oilfield, the anticipated benefits from the acquisition cannot be fully realized, the possibility that costs or difficulties related to the development of the Durimu oilfield will be greater than expected, and other risks described in the Company ' s annual report on Form 10-K for the year ended December 31, 2010 and its other filings with the SEC. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those indicated. Investors should not place undue reliance on forward-looking statements. Each forward-looking statement speaks only as of the date of the particular statement and the Company undertakes no duty to update any forward-looking statement. For more information, please contact: China North East Petroleum US officeTel: +1-909-610-2212China North East Petroleum Investor Relations DepartmentTel: +1-646-308-1707
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV