Longreach Advances Moroccan Exploration Programme

2013 and fourth quarter results published 
SAINT HELIER, Jersey, April 28, 2014 /CNW/ - In 2013, LONGREACH OIL AND GAS 
LIMITED (TSXV: LOI) (the Company or Longreach) successfully advanced its 
exploration programme completing one promising well and setting the stage for 
a highly prospective second well currently drilling ahead. The Company's first 
exploration well, Koba-1 on its operated Sidi Moktar exploration licence, 
encountered very encouraging natural gas resource potential that indicated an 
estimated 45 metres of reservoir potential. Longreach is currently drilling a 
second exploration well, Kamar-1, on the property and has set casing above the 
first targeted reservoir. Future operational activity in the Sidi Moktar area 
will be determined after the completion, analysis and interpretation of the 
Koba-1 well and the Kamar-1 well. Longreach also plans to participate in an 
exploration well being drilled on its non-operated Sidi Moussa Offshore 
licence in the third quarter of 2014. 
The Company exited 2013 with cash of US$12.7 million and raised an additional 
CAD$9.7 million through a private placement in April 2014. Longreach intends 
to evaluate additional financing opportunities in 2014. 
Longreach today filed its annual financial statements for the year ended 
December 31, 2013, together with its Management's Discussion and Analysis in 
respect of the Company's financial results for the year ended December 31, 
2013. These documents are available on the Longreach website at 
www.longreachoilandgas.com or under the Company's profile on SEDAR at 
www.sedar.com. 
Highlights 
Financial: 


        --  Cash position as at December 31, 2013, of US$12.7 million
            (US$34.2 million as at December 31, 2012; US$21.3 million as at
            September 30, 2013)
        --  Working capital as at December 31, 2013, of US$3.9 million
            (US$32.6 million as at December 31, 2012; US$18.9 million as at
            September 30, 2013)
        --  Subsequent to year-end, completed an interim debenture
            financing of CAD$9.7 million in April 2014 and intends to
            obtain further financing in 2014, which may include a rights
            offering or private placement

Operations Summary:
        --  Sidi Moktar:
      o Commenced drilling of the Koba-1 well, targeting Lower Liassic and
        Upper Triassic clastic reservoirs. The Koba-1 well was drilled to a
        total depth of 3,100 metres and operations were completed in early
        January 2014. The well encountered a gross interval of
        approximately 45 metres with reservoir potential.
      o On March 20, 2014, the Company commenced drilling of the Kamar-1
        well, targeting a Lower Liassic reservoir and Triassic clastic
        reservoirs. The Kamar-1 well has a planned total depth of 3,500
        metres and operations are anticipated to take approximately 70
        days.
      o Following the Kamar-1 well, the Company will review the forward
        operational programme.
        --  Foum Draa Offshore:
      o In late October 2013, the operator, Cairn Energy plc (Cairn
        Energy), commenced drilling the FD II-Alpha-1 exploration well
        located in 1,500 metres of water approximately 120 kilometres
        offshore of Morocco. The well was drilled to a total depth of 5,255
        metres (subsea), but did not encounter clastic reservoirs. The well
        has been plugged and abandoned.
        --  Sidi Moussa Offshore:
      o Longreach has been advised that the operator, Genel Energy plc
        (Genel), has secured a rig to drill an exploration well targeting
        the Mid-Jurassic and Lower Triassic reservoirs in the third quarter
        of 2014.

Operational Update

Sidi Moktar Onshore (Net Working Interest 50%)

Longreach has a 50 percent operating interest in the onshore Sidi Moktar 
exploration licence. Sidi Moktar is comprised of three blocks (Sidi Moktar 
West, Sidi Moktar South and Sidi Moktar North) totalling 2,683 square 
kilometres, which cover the majority of the hydrocarbon basin of Essaouira, 
located in central onshore Morocco.  The blocks surround the producing Meskala 
field, which is considered Morocco's major producing field and operated by the 
Office National des Hyrdocarbures et des Mines (ONHYM), the Moroccan state 
energy company. In 2011, the Meskala field produced approximately 3.6 million 
cubic feet per day of natural gas and 168 barrels per day of condensate from 
the Triassic reservoir. Four fields within Sidi Moktar have historically 
produced 30.5 billion cubic feet (Bcf) of gas from Jurassic-aged reservoirs.

Sidi Moktar has a significant amount of historical exploration data available, 
including 6,172 kilometres of 2D seismic, and 43 exploration and development 
wells. Longreach has interpreted over 4,500 kilometres of existing 2D seismic 
data and has completed the reprocessing of 1,750 kilometres of this data. 
Longreach has also completed comprehensive petrophysical and petrographic 
analyses of the neighbouring wells and outcrop sections to better understand 
the reservoir and seal potential of the Lower Liassic and Triassic 
stratigraphic sections. Subsequently, a portfolio of 12 prospects and leads 
has been mapped, ranked and risked.

On November 15, 2013, Longreach announced an updated independent technical 
report (effective date June 30, 2013) of the Company's petroleum assets, 
including the Sidi Moktar licence, that was prepared by Gaffney, Cline & 
Associates (GCA), a qualified reserves evaluator in accordance with National 
Instrument 51-101 requirements using the Canadian Oil and Gas Evaluation 
Handbook. GCA confirmed that Longreach's reinterpretation of the seismic and 
other data had resulted in a new model for the structural evolution of the 
Sidi Moktar area and concurs with Longreach's interpretation that the 
anticlines are more likely formed by inversion of Permo-Triassic half grabens. 
As a result, there is potential for hydrocarbon bearing clastic reservoirs to 
be found below Jurassic carbonate seals. GCA's best estimate of unrisked 
prospective resources are 420 Bcf of natural gas and 25.1 million barrels 
(MMbbl) of condensate for the Koba prospect, with a geological chance of 
success of 25 percent, and 91 Bcf of natural gas and 6.1 MMbbl of condensate 
for the Kamar Subcrop prospect, with a geological chance of success of 11 
percent. The Kamar-1 well is expected to test the Kamar Subcrop, as well as 
the Kamar Onlap prospect (stratigraphically above the Kamar Subcrop) to which 
GCA estimated 232 Bcf of natural gas and 13.9 MMbbl of condensate, with a 
geological chance of success of six percent.

During 2013, the Company commenced drilling of the Koba-1 well, targeting the 
Lower Liassic and Upper Triassic clastic reservoirs. The Koba-1 well was 
drilled to a total depth of 3,100 metres and operations were completed in 
early January 2014. The well encountered a gross interval of approximately 45 
metres with reservoir potential. Over this section, a gas influx of over 10 
percent was encountered throughout the interval with heavier hydrocarbon 
components of condensate (over C5+). The Koba-1 well is currently suspended 
and the Company is reviewing the logs to assess the options available.

On March 20, 2014, the Company commenced drilling of the Kamar-1 well, 
targeting a Lower Liassic and Triassic clastic reservoirs. The Kamar-1 well 
has a planned total depth of 3,500 metres and operations are anticipated to 
take approximately 70 days. The Company plans to review the forward 
operational programme following the completion of the Kamar-1 well.

Sidi Moussa Offshore (Net Working Interest 1.5%) and Foum Draa Offshore (Net 
Working Interest 2.5%)

In September 2009, Longreach agreed to terms to earn a 7.5 percent net working 
interest in the Sidi Moussa Offshore licence and the Foum Draa Offshore 
licence.  Located directly west of the coastal city of Agadir, the two 
licences cover an area of approximately 12,714 square kilometres.

On August 23, 2012, Longreach entered into a farm-out agreement with Genel 
whereby Genel acquired a 60 percent operating equity interest in the Sidi 
Moussa Offshore licence proportionally from Longreach and each of its joint 
venture partners. Genel paid its equity interest share of past costs, being 
US$129,990 net to Longreach, and is expected to pay the first US$50 million 
towards drilling of the commitment well (including  ONHYM's 25 percent carried 
interest) required under the terms of the First Extension Period of the Sidi 
Moussa Licence. Longreach's net interest in the Sidi Moussa Offshore licence 
has been reduced from 7.5 percent to 1.5 percent as a result Genel's farm-in. 
The Company has been advised by Genel that an offshore exploration well 
targeting Mid-Jurassic / Lower Triassic reservoirs is anticipated to be 
drilled in the third quarter of 2014.

On August 28, 2012, Longreach entered into a farm-out agreement with Cairn 
whereby Cairn acquired a 50 percent operating equity interest in the Foum Draa 
Offshore licence proportionally from Longreach and each of its joint venture 
partners. In 2013, Cairn paid its equity interest share of past costs, being 
US$150,000 net to Longreach, and paid the first US$60 million towards drilling 
of the FD-1 exploration well (including ONHYM's 25 percent carried interest), 
a commitment well under the terms of the First Extension Period of the Foum 
Draa Licence. Longreach's net interest in the Foum Draa exploration licence 
has been reduced from 7.5 percent to 2.5 percent as a result of Cairn's 
farm-in.

In late October 2013, Cairn commenced drilling the FD II-Alpha-1 exploration 
well located in 1,500 metres of water approximately 120 kilometres offshore of 
Morocco. The well was drilled to a total depth of 5,255 metres (subsea), but 
did not encounter clastic reservoirs where the primary target was a Late 
Jurassic and Early Cretaceous deep-water turbidite slope fan. It did penetrate 
the oldest stratigraphic section of any deep water exploration well along the 
Moroccan margin. The well was subsequently plugged and abandoned.

Zag Basin Onshore (Net Working Interest 22.5%)

The operator of the Zag Basin, San Leon Energy Plc, completed a 15,000 square 
kilometre aeromagnetic survey and a 1,674 kilometre 2D seismic survey on the 
licence in January 2012, largely on the eastern part of the property area.  
This was the first seismic data ever acquired on this licence. Interpretation 
of the surveys has indicated a portfolio of structural leads.

Having successfully completed the minimum work programme obligations for the 
Initial Period of the exploration licence, the joint venture partners elected 
to move into the First Extension Period. The First Extension Period has a 
minimum work programme requirement for one well to test either the Ordovician 
formation or to drill to a minimum depth of 3,000 metres by May 2015.

About Longreach
Longreach is an independent Canadian oil and gas company focused on its 
significant land position in Morocco. The Company has a 50 percent operated 
interest in the Sidi Moktar licence area covering 2,683 square kilometres and 
is working closely with ONHYM as a committed long-term partner to unlock the 
hydrocarbon potential of the region. Morocco offers a politically stable 
environment to work within and has favourable fiscal terms to energy 
producers. Longreach is a public company listed on the TSX Venture Exchange 
under the symbol "LOI".

Additional information about the Company can be found at 
www.longreachoilandgas.com and under the Company's SEDAR profile at 
www.sedar.com.

Special Note Regarding Analogous Information

Although the Company believes that production on the Meskala field, which is 
adjacent to the Sidi Moktar licences, may indicate that production is possible 
from the Koba structure, no assurance can be given by the Company that 
commercial production on any of the Sidi Moktar exploration licences will be 
achieved, or as to the levels of production that may be possible on any of the 
Sidi Moktar exploration licences if production is achieved.

Special Note Regarding Estimates

The unrisked prospective resources described above have been estimated using 
probabilistic methods and are dependent on a petroleum discovery being made.

Prospective 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 resources have both an 
associated chance of discovery and a chance of development. Prospective 
resources are further subdivided in accordance with the level of certainty 
associated with recoverable estimates assuming their discovery and development 
and may be subclassified based on project maturity. The prospective gas and 
condensate resources in the GCA report indicate exploration opportunities and 
quantify the development potential in the event a commercial discovery is made 
and should not be construed as reserves or contingent resources. The 
prospective resources set out in the tables above are those undiscovered, 
highly speculative gas and condensate resources estimated beyond gas and 
condensate reserves or contingent gas and condensate resources where 
geological and geophysical data suggest the potential for discovery of 
petroleum but where the level of proof is insufficient for classification as 
reserves or contingent resources. The unrisked prospective gas and condensate 
resources are the range of volumes that GCA estimates could reasonably be 
expected to be recovered in the event of discovery and development of these 
resources.

Definitions

The following terminology, consistent with the COGE Handbook and guidance from 
Canadian securities regulatory authorities, was used to prepare the disclosure 
relating to the prospective gas and condensate resources above.

"Best Estimate" (Best) is considered to be the best estimate of the quantity 
of resources that will actually be recovered. It is equally likely that the 
actual remaining quantities recovered will be greater or less than the best 
estimate. Those resources that fall within the best estimate have a 50 percent 
confidence level that the actual quantities recovered will equal or exceed the 
estimate.

"Low Estimate" (Low) is considered to be a conservative estimate of the 
quantity of resources that will actually be recovered. It is likely that the 
actual remaining quantities recovered will exceed the low estimate. Those 
resources at the low end of the estimate range have the highest degree of 
certainty - a 90 percent confidence level - that the actual quantities 
recovered will equal or exceed the estimate.

"High Estimate" (High) is considered to be an optimistic estimate of the 
quantity of resources that will actually be recovered. It is unlikely that the 
actual remaining quantities of resources recovered will meet or exceed the 
high estimate. Those resources at the high end of the estimate range have a 
lower degree of certainty - a 10 percent confidence level - that the actual 
quantities recovered will equal or exceed the estimate.

Special Note Regarding Forward Looking Statements
This press release contains forward-looking statements. Such forward-looking 
statements relate to future events or the Company's future performance. All 
statements other than statements of historical fact are forward-looking 
statements. Forward-looking statements are often, but not always, identified 
by the use of words such as "may", "will", "should", "expect", "plan", 
"anticipate", "believe", "estimate", "predict", "project", "potential", 
"targeting", "intend", "could", "might", "continue" or the negative of these 
terms or other similar terms. Forward-looking statements in this press release 
include, but are not limited to, statements regarding the drilling of the 
Karmar-1 well at the Company's operated Sidi Moktar onshore license area in 
Morocco; the ability of the Company to successfully complete the drilling 
programme at Kamar-1 over the next few weeks; the completion of evaluations 
and processing and interpretation of data, the performance characteristics of 
the Company's oil and gas properties, capital expenditure programmes, supply 
and demand for oil, gas and commodities, prices for oil and gas, drilling 
plans, and realization of the anticipated benefits of acquisitions.

Forward-looking statements are only predictions. Forward-looking statements 
involve known and unknown risks, uncertainties and other factors that may 
cause actual results or events to differ materially from those anticipated in 
such forward-looking statements. Some of the risks and other factors which 
could cause results to differ materially from those expressed in the 
forward-looking statements contained in this press release include, but are 
not limited to: general economic conditions in Canada, the Kingdom of Morocco 
and globally; completing the proposed drilling programme at Kamar-1 in a 
timely and fiscally prudent manner; industry conditions, including 
fluctuations in the price of oil and gas, governmental regulation of the oil 
and gas industry, including environmental regulation; fluctuation in foreign 
exchange or interest rates; risks inherent in oil and gas operations; 
political risk, including geological, technical, drilling and processing 
problems; unanticipated operating events which could cause commencement of 
drilling and production to be delayed; the need to obtain consents and 
approvals from industry partners, regulatory authorities and other 
third-parties; stock market volatility and market valuations; competition for, 
among other things, capital, acquisitions of reserves, undeveloped land and 
skilled personnel; incorrect assessments of the value of acquisitions or 
resource estimates; any future inability to obtain additional funding, when 
required, on acceptable terms or at all; credit risk; changes in legislation; 
any unanticipated disputes or deficiencies related to title matters; 
dependence on management and key personnel; and risks associated with 
operating in and being part of a joint venture.

Although the forward-looking statements contained in this press release are 
based upon factors and assumptions which management of the Company believes to 
be reasonable, the Company cannot assure that actual results will be 
consistent with its expectations and assumptions. Material factors and 
assumptions which management of the Company has considered in connection with 
making the forward-looking statements in this press release include that the 
Company will be able to successfully complete the drilling programme at 
Kamar-1 and to successfully evaluate, process and interpret data. Undue 
reliance should not be placed on the forward-looking statements contained in 
this news release as there can be no assurance that the plans, intentions or 
expectations upon which they are based will occur. These statements speak only 
as of the date of this press release, and the Company does not undertake any 
obligation to publicly update or revise any forward-looking statements except 
as expressly required by applicable securities laws.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that 
term is defined in policies of the TSX Venture Exchange) accepts 
responsibility for the adequacy or accuracy of this release.

This news release does not constitute an offer to sell or a solicitation of an 
offer to buy any securities of Longreach in any jurisdiction in which such 
offer, solicitation or sale would be unlawful. The securities referred to 
herein have not been and will not be registered under the United States 
Securities Act of 1933 (the "U.S. Securities Act") or any state securities 
laws and may not be offered or sold within the United States or to U.S. 
Persons (as defined in the U.S. Securities Act) unless registered under the 
U.S. Securities Act and applicable state securities laws, or an exemption from 
such registration is available.



SOURCE  Longreach Oil and Gas Limited 
Martin Arch Chief Financial Officer and Secretary Tel: +44 203 137 7756 
To view this news release in HTML formatting, please use the following URL: 
http://www.newswire.ca/en/releases/archive/April2014/28/c5393.html 
CO: Longreach Oil and Gas Limited
NI: OIL ERN  
-0- Apr/28/2014 06:00 GMT
 
 
Press spacebar to pause and continue. Press esc to stop.