AED 0.00% 14.5¢ aed oil limited

well performance and fpso update

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    AED Oil Limited
    ACN 110 393 292
    PO Box 18199
    COLLINS STREET EAST VIC 8003
    AUSTRALIA
    ASX Announcement
    22 February 2008
    Well Performance and FPSO Update
    Well Performance Review
    The Company is pleased to provide an update on the well performance review
    presently being undertaken.
    As you will recall from the December quarterly report AED has appointed a world
    leading and independent technical advisor to provide three reports to the Company on
    the following issues:
    • Phase 1 - identification and analysis of existing production well issues. (A
    summary of which was released to the Market on 31 January2008)
    • Phase 2 - advise on remediation procedures for existing wells, Puffin 7 and
    Puffin 8 and potential for improvement in oil production rates
    • Phase 3 - detailed advice on optimal implementation of procedures for future
    wells including Puffin 11 to ensure avoidance of future production as seen in
    Puffin-7.
    The Phase 3 report has now been received and concludes the following;
    • “Improved drilling and completion design are feasible and readily achievable to
    ensure better long term productivity for future Puffin North East wells. These
    improved drilling, completion and cleanup practices should ensure avoidance of
    the localized well production problems encountered by Puffin-7”.
    Further, the independent technical advisor’s draft Phase 2 report has now been
    received and confirms that there is a high likelihood of effective remediation of the
    Puffin 7 well, with the prospect of an initial increase in oil production by a factor of 2
    - 3 times existing production levels. The Company believes a remediation program
    could be implemented on a cost effective basis within an 8 week timeframe subject
    to procurement schedules.
    To recap on the previously announced Phase 1 report findings;
    • Production impairment at Puffin-7 is due to drilling and completion factors. (It is
    noteworthy that the consultants modeling required no change in reservoir volumes
    to simulate the reported production rates, i.e. the production issues are localised
    to the current wells rather than reservoir-related).
    Production
    We have been advised by the FPSO - Front Puffin that local weather conditions have
    improved following the weakening of TC Nicholas during the week. It is likely that
    reconnection to the Puffin production well will occur over the weekend. Work has
    Page 2 of 2
    been progressing on repairs to the compressor on board the FPSO over the past week.
    The compressor should be back in full operation mid next week. In the meantime
    crude oil production will commence once the FPSO is reconnected.
    Trevor Slater
    Company Secretary
    General Manager, Marketing
    Contacts
    Trevor Slater – Company Secretary/General Manager, Marketing (03) 9656 7800
 
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