Prospectus re Admission to the Official List - Heritage Oil

RPS EnergyHeritage Oil – Competent Persons ReportThe installation and commissioning of new facilities of appropriate size for the production, processingand transportation of the produced oil; (Heritage advise that CND’s plan is currently in front ofregulators for their approval)The raising of sufficient capital funds to cover these development costs.4.5. Facilities and CostsCommercial production commenced in 2007 on a small scale from two wells. The current plan is to drill upto 84 producers in the p50 case along with 46 Water Injection wells for reservoir support. Two drilling rigswill eventually be required with a planned 16 wells in years 2010 to 2012. The p50 Case is expected toproduce over 60 MMstb peaking at about 16,000 bopd in 2014. Capital expenditure (facilities costs) for themost likely case is estimated at US$180 MM including a 20 per cent. contingency. The 130 wells will bedrilled at a cost of average US$2 MM each. In the p10 case, with over 200 wells. RPS has assumed anadditional drilling rig is required from 2011. Production would be over 170 MMstb with a capitalexpenditure of over US$300 MM. Operating costs are assumed to be US$12 MM per annum during theplateau years plus a further US$1.5 MM per annum for G&A.5. UGANDA—BLOCKS 1 & 3A5.1. OverviewUgandan Block 3A is located in the south of Lake Albert and covers the southern part of the Ugandan sideof Lake Albert. Block 1 is located on land to the north of Lake Albert. Lake Albert is a largest lake in thenorthern sector of the Western Rift. The lake surface is approximately 618 m above sea level and its riftedmargins are more than 2,200 m above sea level in the west and more than 1,300 m in the east. Here, thegraben has an average width of 45 km and is approximately 190 km long. Whilst many of the Western Riftsegments contain deepwater lakes, such as Lake Malawi (750 m) and Lake Tanganyika (1,500 m), LakeAlbert has relatively shallow water depths (approximate maximum of 60 m) but is believed to have similarsediment thicknesses as the other lakes.The Albert Basin is the most petroleum prospective area in Uganda and is a classical active rift basin of theEast African Rift system.5.2. Data AvailableThe seismic database in Block 3A comprises 16 widely spaced 2D seismic lines of varying vintages2003-2005. The data quality in the northern half of the block is fair with well defined reflections down tothe base of the Tertiary basin fill. To the south of the block the regional data becomes increasingly poor andmapping of the deeper levels is particularly difficult. A 3D survey also exists over the Kingfisher discoverycovering 450 sq km along the south eastern lake shore, data quality is reasonable. Shallow data atKingfisher lose coherency but this is above the zones of interest in the wells. Well data from 3 wells;Kingfisher-1, Kingfisher-1A and Kingfisher-1B were made available. Full log suites were made availablefor these wells as well as geological and test data.Block 1 is currently covered by 17 2D seismic lines across the southern portion of the block. Data quality isgenerally very good with retention of amplitudes, coherent reflector packages and fairly crisp faultterminations. As noted above, seismic acquisition in Blocks 1 and 3A is not due for completion untilMarch 2008. Much of the area outside the 3D seismic in Block 3A will be covered by additional infill 2Dlines and data will be available for the northern part of Block 1A.Tullow has been exploring a fault terrace in Block 2, to the north of Heritage’s Block 3A and has a numberof reported discoveries but RPS has no access to data from these wells.105