DGAP-News

Coastal Energy Announces Offshore Operations Update and Onshore Discovery (deutsch)

Coastal Energy Announces Offshore Operations Update and Onshore Discovery

Coastal Energy Company

22.02.2012 22:02

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HOUSTON, 2012-02-22 22:02 CET (GLOBE NEWSWIRE) --

Coastal Energy Company (the 'Company' or 'Coastal Energy') (TSX:CEN) (AIM:CEO),

an independent exploration and production company with assets in Thailand,

announces an update of its offshore operations and the successful discovery and

production testing results from the sidetrack of the Dong Mun 3 onshore gas

well and acquisition of increased working interest there.

Offshore

Coastal Energy has drilled two additional producing wells and one water

injection well at Bua Ban North. One of the producing wells was drilled

horizontally, has been tied in and is currently producing. The Company has two

more wells to bring online at Bua Ban North. Current offshore production is

averaging 26,000 bopd, bringing total company production to 28,000 boepd. The

rig is now being mobilized to Bua Ban South and is expected to spud the first

well there by the end of February.

Onshore

The sidetrack of the Dong Mun 3 well, located on Block L27/43 onshore Thailand,

reached a total depth of 2,539 meters TVDSS on the sidetrack of the Dong Mun 3

well. The well encountered a vertical gas column of approximately 113 meters

with porosity of up to 6 percent. The well was flow tested for 24 hours and

produced at an average rate of 15 mmcfd with flowing pressure of 1,950 psi

through a 32/64' choke. Further testing, appraisal and commercialization

options for the Dong Mun are being reviewed by the partners. APICO is a joint

venture and the operator of the L27/43 concession. Coastal currently owns 36.1%

of APICO, making it the largest stakeholder in the joint venture.

Coastal has entered into an agreement to acquire an additional 2.9% stake in

APICO, which is currently held by a minority partner, for US$9.25 million in

cash, bringing Coastal's interest in APICO to 39%. This transaction is expected

to close on or about February 23, 2012. APICO also holds a 35% interest in the

nearby Sinphuhorm Gas Field, thus increasing Coastal's net interest in the

field to 13.65%.

Randy Bartley, President and CEO of Coastal Energy, commented:

'Our offshore operations continue to progress as planned. The recent wells at

Bua Ban North showed results consistent with our prognoses. Most importantly,

the horizontal well at Bua Ban North B is performing similarly to the

horizontal well which was drilled at Bua Ban North A in 2011. This further

confirms our thesis that horizontal wells will be a significant tool in the

development of this field.

'The test results of the Dong Mun 3 sidetrack are extremely encouraging.

Testing is ongoing to determine the maximum deliverability of the well and

evaluate additional stimulation, which could lead to a significant increase in

flow rates. The location of this sidetrack was determined using recently

acquired 3D seismic. The drilling results combined with the new 3D seismic

strongly indicate that this gas structure has an areal extent of over 5,000

acres, giving this resource tremendous potential. Now that the commercial

viability of the field has been determined, we have begun the process of

applying for a production license.

'We are also pleased with our acquisition of a further stake in APICO. This

transaction is accretive to our 1P and 2P NAVs using only Sinphuhorm

valuations. The discovery being announced today makes it an even more exciting

transaction for us.'

Particulars of the Transaction

Coastal acquired the additional 2.9% stake in APICO from Roil Production

Thailand, LLC. APICO holds a 35% working interest in the Sinphuhorm natural gas

field onshore Thailand, as well as 100% working interests in concessions L27/43

and L15/43 onshore Thailand. APICO had USD33.4MM of net income in 2010.

Randy Bartley, President and Chief Executive Officer of the Company and a

member of the Society of Petroleum Engineering and Jerry Moon, Vice President,

Technical & Business Development, a member of the American Association of

Petroleum Geologists, a Certified Petroleum Geologist and a Licensed

Professional Geoscientist in the state of Texas, have reviewed the contents of

this announcement.

Additional information, including the Company's complete competent person's

report may be found on the Company's website at www.CoastalEnergy.comor may be

found in documents filed on SEDAR at www.sedar.com.

The Coastal Energy Company logo is available at

http://www.globenewswire.com/newsroom/prs/?pkgid=10062

This statement contains 'forward-looking statements' as defined by the

applicable securities legislation. Statements relating to current and future

drilling results, existence and recoverability of potential hydrocarbon

reserves, production amounts or revenues, forward capital expenditures,

operation costs, oil and gas price forecasts and similar matters are based on

current data and information and should be viewed as forward-looking

statements. Such statements are not guarantees of future results and are

subject to risks and uncertainties beyond Coastal Energy's control. Actual

results may differ substantially from the forward-looking statements.

These securities have not been registered under United States Securities Act of

1933 (the 'US Securities Act') or the securities laws of any state and may not

be offered or sold in the United States or to US persons (as defined in

Regulation S under the US Securities Act) unless an exemption from registration

is available.

CONTACT: Enquiries:

Coastal Energy Company

Email: [e-mail]

[phone]

Strand Hanson Limited (Nominated Adviser)

[phone]

Rory Murphy

Paul Cocker

Macquarie Capital (Europe) Limited (Broker)

[phone]

Paul Connolly

Jeffrey Auld

FirstEnergy Capital LLP (Broker)

Hugh Sanderson

[phone]

Travis Inlow

Buchanan Communications

Tim Thompson

[phone]

Ben Romney

News Source: NASDAQ OMX

22.02.2012 Dissemination of a Corporate News, transmitted by DGAP -

a company of EquityStory AG.

The issuer is solely responsible for the content of this announcement.

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Language: English

Company: Coastal Energy Company

United States

Phone:

Fax:

E-mail:

Internet:

ISIN: KYG224041189

WKN:

End of Announcement DGAP News-Service

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