UMC Energy PLC : PNG Petroleum project update

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6 January 2014

UMC Energy Corporation

("UMC Energy" or the "Company")

PNG Petroleum project update

UMC Energy advises that following an application by its 30% associate Gini Energy Limited ("Gini"), the Papua New Guinea Department of Petroleum and Energy has varied the minimum work conditions of the offshore Petroleum Prospecting Licences (PPL), PPL 374 and PPL 375, held 100% by Gini.  CNOOC Ltd ("CNOOC") holds a 70% interest in Gini and carries all exploration and appraisal expenditure in respect of the PPLs up to commercial development.

As summarised in the circular sent to shareholders on 5 August 2013, the following principal conditions applied to each of the offshore permits, PPL 374 and PPL 375 granted on March 18 2011:

1.   During year 1 and 2, Gini at a cost of not less than US$200,000 shall undertake the following work:- review available data, conduct geological and geophysical studies, field mapping and planning for field work, especially seismic data acquisition.

2.   During Year 3 and 4, Gini shall undertake the following work:- acquire 1000 line kilometres of 2D seismic data and drill one exploration well.

3.   During Year 5, Gini shall undertake the following work:- acquire additional 2D seismic work as necessary and drill a second exploration well.

The Year 3 and 4 requirements as summarised in point 2 above have been revised for each of PPL 374 and PPL 375 to the following:

During Year 3 and 4, Gini at a cost of not less than US$6 million shall undertake the following work:- acquire at least 1000 line km of 2D seismic data, conduct geological and geophysical studies and, subject to the results of the 2D seismic results, plan and conduct a 3D seismic survey over the License area.

The Year 5 requirements as summarised in point 3 above have been revised for each of PPL 374 and PPL 375 to:

During Year 5 and 6, Gini shall undertake the following work:- drill one exploration well and, subject to the results of the first well, drill a second well.

Pursuant to the agreements between the Company and CNOOC, CNOOC remains responsible for funding any additional expenditure arising out of the variations referred to above.

Chris Hart, Technical Director of UMC Energy, stated "this modification to the original work programme reflects sound technical requirements for these offshore permits to acquire 3D seismic data over the most prospective leads identified by the newly acquired 2D seismic prior to selection of the lowest risk prospects to undertake the drilling of exploration wells."

Enquiries:

UMC Energy Corporation Chrisilios Kyriakou, Chairman	[phone]
Strand Hanson Limited(Nominated Adviser) Angela Hallett / James Spinney	[phone]
Shore Capital Stockbrokers Limited(Joint Broker) Jerry Keen / Stephane Auton / Patrick Castle	[phone]
HD Capital Partners LLP (Joint Broker) Philip Haydn-Slater / Paul Dudley	[phone]

This information is provided by RNS

The company news service from the London Stock Exchange

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