New well to be drilled based upon success of Rogity-1

March 11, 2014

San Leon has completed the hydraulic fracture stimulation programme and testing of the Rogity-1 well on the Braniewo S Concession (the "Concession") in Poland's northern Baltic Basin. This three-stage frac and testing programme (the “Programme”) at Rogity-1 was performed as part of the farm-out agreement ("FOA") with Wisent Oil & Gas plc ("Wisent"), under which Wisent was required to design, perform, and fund the costs of the Programme including testing each zone. The objective of the Programme was to understand the fraccability and potential for commercial oil production from the middle Cambrian sandstone, the Ordovician shale/carbonate, and the Lower Silurian shales. United Oil Field Services (“UOS”) was contracted to perform the Programme. Wisent has completed all of its obligations under this initial stage of the FOA giving it the option to drill, stimulate and test a horizontal well to earn a 45% working interest in the Braniewo S Concession.

Frac 1 was performed in the middle Cambrian sandstone interval between 2,760-2,765 meters using 3,500 bbls of frac fluid and 100,000 pounds of 40/70 mesh sand. All fluid and propant was successfully placed into the formation. As previously announced, oil and formation water were recovered on test suggesting the Rogity-1 Cambrian sandstone interval is around the oil-water contact on the Rogity structure.

Frac 2 was performed in the Ordovician marls and shales interval between 2,700-2,720 meters pumping over 6,000 barrels of frac fluid and over 145,000 pounds of 40/70 and 30/50 mesh sand. All fluid and propant was successfully placed into the formation.

Frac 3 was performed in the Lower Silurian Llandovery shale interval between 2,630-2,655 meters pumping over 4,000 barrels of frac fluid and over 100,000 pounds of 40/70 and 30/50 mesh sand. All fluid and propant was successfully placed into the formation.

Following completion of the second and third stimulations, frac fluid was cleaned up through the completion. The flowback was performed commingled between all three frac stages. Once again oil was recovered at surface, and detailed geochemical analysis was undertaken in order to understand the layer contributions. Once the final geochemical results were interpreted it became clear that different oil was produced from the shales and the Cambrian sandstone – in other words, mobile oil was recovered from the shales as well as the Cambrian sandstone. The oil has a gravity of around 39 degress API, with no sulphur.

San Leon and its partners continue to evaluate the potential for unconventional oil production from the Lower Silurian in the Braniewo S concession having only tested one 20m interval. Any appraisal of a potential Cambrian oil accumulation will also be designed to test the potential of the lower Silurian and Ordovician.

Source: New Well, 2014.