Talon1 funding update

COMPANY ANNOUNCEMENT
13th July 2011
Talon1 funding update

L&M Energy Limited (ASX: LME) advises that AGL Energy Limited (“AGL”) has executed an Agreement to sell AGL’s 50% interest in PEP51151 (Alton) to New Zealand Energy Corp. (“NZEC”). The Agreement is subject to obtaining New Zealand ministerial consent.

As previously announced NZEC have agreed to fund 100% of LME’s share of expenses in the currently drilling Talon1 exploration well approximately NZ$1.75 million (including $250,000 of completion costs, in the event of a discovery), with LME retaining its existing 50% interest in PEP 51151.

Talon1 is the first well to be drilled on the 482.4km2 permit, which also contains multiple further targets. The well is targeting mean reserves of 2mmbbl oil (recoverable) in shallow Manutahi sands in a structure geologically identical to the adjacent Manutahi Oil field operated by Origin Energy (estimated recoverable reserves of 4mmbbl).

Talon1 drilling operations are currently underway: surface casing has been set to 507m and the drilling rig is currently being set up for drilling the second, deviated phase of the well to the target depth of 1455m.

ENDS

Full release with maps July_13_2011_Talon1_Funding_Update.pdf

© Scoop Media