SAMPLING AND ANALYSIS AT AN EXPLORATION WELL AT TERRAWEST'S LIUHUANGGOU PROPERTY
Monday, 17 January 2011
Vancouver, British Columbia, January 17, 2011 – Petromin Resources Ltd. (“Petromin” or, the “Company”) is pleased to announce that TerraWest Energy Corp. (“TWE”) is currently performing testing at an exploration well being drilled beyond 1,500 meters depth by Xinjiang Oilfield Company of PetroChina Company Limited (“Xinjiang Oilfield”) within the area of the Liuhuanggou coalbed methane (“CBM”) project (“Liuhuanggou Project”) in Xinjiang, the People’s Republic of China (“China”).
The Liuhuanggou Project, covering approximately 653 square kilometers (255 square miles; 163,200 acres) in the southern Junggar basin of Xinjiang, China operates under a production sharing contract (“PSC”) dated 30 December 2005 entered into between TWE and China United Coalbed Methane Corporation Limited (“CUCBM”).
Xinjiang Oilfield agreed to allow TWE’s geologists to sample prospective Jurassic Badaowan (“J1B”) formation rocks to be intersected in its exploration well and such sampling is currently underway. TWE’s geologists will also have access to mud logs and geophysical logs and TWE will contribute to the coverage of the costs of acquiring all data utilized.
Samples of the target J1B formation will be analysed at selected laboratories after gas desorption testing.
TWE has indicated the arrangement reflects the co-operative spirit between the professional staff of TWE and Xinjiang oilfield operating in Liuguanggou.
The Company is pleased to see this type of arrangement between the two parties and it reflects a high degree of co-operation and the joint interest in the scientific data on the energy resource base of the southern Junggar Basin as well as the economic potential of the region.
As at the date hereof, the Company held 27.49% of the current issued common shares and preferred shares in the capital of TWE. TWE is the Operator and holds a 47% interest in the PSC with CUCBM holding 53%. Under the terms of the PSC, CBM is defined as all gas stored in four (4) named geologic formations of Jurassic age to a depth of 1,500 meters.