Operations and Production Update

    RNS Number : 9374D
  Elixir Petroleum Ltd
  22 September 2008
   

    Elixir Petroleum Limited
    (AIM : ELP)

    22 September 2008
    
OPERATIONS AND PRODUCTION UPDATE

    Elixir Petroleum Limited ("Elixir"), the international oil and gas exploration and production company, is pleased to provide an
operations update.

    Hurricane Ike

    Elixir's operations at the High Island and Pompano projects located in the Gulf of Mexico were shut-in during the passage of Hurricane
Ike. We are pleased to report that the platforms and associated offshore infrastructure were not damaged. 

    Whilst production at the Pompano project recommenced on the 19/09/08, some damage was sustained to the onshore section of the export
pipeline into which Elixir's High Island production is sold. An evaluation of the damage to the pipeline and the programme required to
effect repairs is currently being investigated by the pipeline owner. The damage is not believed to be severe and production should restart
within the next week. 

    Well ž3 - Pompano Project 

    The operator at the Pompano Project has also advised that the Hercules 152 jack-up drilling rig, which is contracted to drill the third
development well at Pompano, was not damaged by Hurricane Ike and has been mobilised to the field. The rig arrived on location on the
19/09/08 and was last reported to be making preparations to drive the 36" Caisson.

    Well ž3 will be drilled through this new Caisson which will be positioned adjacent to the existing ž5 Caisson. The ž5 Caisson forms part
of the existing field infrastructure and is located approximately 900m to the southwest of the 'A' Production Platform to which it is
already connected via subsea flowlines (see schematic below).

    Well ž3 is targeting undrilled and updip fault block compartments immediately adjacent to the recently successful Well ž2. The well will
be directionally drilled into a total of 4 primary and 2 secondary target sands. It is expected that the primary sands will contain proven
undeveloped reserves in horizons encountered by Well ž2.  

    It is estimated that Well ž3 will take approximately 25 days to drill and evaluate. If a decision is made to complete the well, then
these operations are expected to take a further 22 days. 

    Subject to integrity testing, the existing flowline infrastructure from the Well ž3 location to the 'A' Production Platform should
facilitate a short time frame to production from the well. The addition of a third production stream to the existing two producing wells
will require some upgrade activity on the 'A' Production Platform. These upgrade activities may temporarily interrupt production from the
field for short periods. 

    Commenting on the announcement, Elixir's Managing Director, Andrew Ross said:

    "Other than a short shut-in period during the passage of Hurricane Ike, we are pleased to advise that the storm has not adversely
affected our projects in the Gulf of Mexico. We look forward to resumption of full production in the near future.

    "We are eagerly anticipating the commencement of drilling operations in the coming days for Well ž3 at the Pompano Project, where we
hope to achieve a similar result to that of our successful Well ž2 and a further lift in production rates from the field."

    The Participants in the Pompano Project and their respective working interests are:

 Elixir Petroleum Ltd *       25.0%
 Buccaneer Energy Ltd *       65.0%
 Baron Petroleum Inc.         7.5%
 Streamline Exploration Inc.  2.5%
                              100%

    * Interests held indirectly via their respective shareholdings in wholly-owned subsidiaries.



    For further information, please visit Elixir's website at www.elixirpetroleum.com or contact:


 Elixir Petroleum Limited                           Blue Oar Securities Plc
 Alex Neuling                                      Jerry Keen / Olly Cairns
 Tel: [phone]              Tel: [phone]
                                                                       1631


 Conduit PR
 Jonathan Charles / Sarah
 Alexander
 Tel: [phone]



    Information contained in this report with respect to the Pompano Project, was compiled by Elixir, or from material provided by the
project operator and reviewed by I L Lusted, BSc (Hons),SPE , who has had more than 15 years experience in the practice of petroleum
engineering. Mr Lusted consents to the inclusion in this report of the information in the form and context in which it appears.

This information is provided by RNS
The company news service from the London Stock Exchange
 
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