IGAS Energy : 31/03/2014 Exploration Drilling and Operational Update

31 March 2014

IGas Energy plc

("IGas" or "the Company")

Completion of Exploration Drilling and Operational Update

IGas (LSE: IGAS), one of the leading producers of onshore hydrocarbons in the UK, is pleased to announce it has completed drilling operations on the Irlam-1 well at Barton Moss in Eccles.  This exploration well encountered the coal measures at anticipated depths.  The well also successfully intersected the secondary target of the Dinantian limestone to calibrate the seismic data and in doing so, the well also found a package comprising the Sabden and Bowland Shale formations.  

As part of the data gathering exercise, over 400 feet of core was acquired across the shale intervals.  A full suite of wire line logs was run which together with the core data will be used to further evaluate the prospectivity of both the shale interval as well as the coal measures.

The well will now be suspended and demobilisation of the rig and equipment will take place.  A full laboratory analysis of the cores will be instigated, which is expected to take up to six months. The results from the core analysis together with the wireline log data will be integrated and utilised to determine the next steps in the appraisal process.  The core data will be very beneficial in understanding the geomechanical aspects of the shales and this will help provide key data to optimise the design of any future programme involving hydraulic fracturing of the Bowland Shale.

Well operations were conducted in a safe and environmentally responsible manner.  A notable feature is that continuous baseline monitoring, including ground water, was conducted throughout the operation and monitoring of the site will continue after demobilisation. 

North West

IGas is now in the process of implementing a programme to acquire ca. 100 km2 of 3-D seismic data in the North West with a view to firming up several potential exploration and development sites in the area, prior to the drilling of our next well.  This 3-D seismic will also fulfil UKOOG Shale Gas guidelines, the recommendations of the Royal Society and Royal Academy of Engineers and is a requirement of the Department of Energy and Climate Change consent process prior to any shale gas hydraulic fracturing and flow testing operations being undertaken.  This data will inform any future hydraulic fracture design and help to ensure minimal environmental impact.

East Midlands

In the East Midlands we have now completed our 3-D seismic acquisition on PEDL 139/140 on behalf of our joint venture partners, Total E&P UK Limited, Egdon Resources, Dart Energy and eCorp.  We will now appraise the results with a view to site selection, before preparing both an Environmental Risk Assessment and subsequently a full Environmental Impact Assessment for the identified exploration well.  In parallel, a comprehensive community engagement programme in the selected area will commence.

Commenting Chief Executive, Andrew Austin, said

"These early exploration results are key to our understanding of the potential resource in the area. 

"We are pleased that the drilling has completed on time and on budget.  We have worked extensively over the last few months with the various authorities to ensure the safety of everyone on and around site including protestors and neighbours.  Our priority remains to conduct our operations safely, in an environmentally responsible manner and with consideration for the local community. "

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For further information please contact:

MHP

Rupert Trefgarne                                                                    Tel: +44 (0)20 3128 8100