NU-Oil digs in at Garden Hill site in Western Newfoundland

The AIM-listed oil exploration company reported good progress at the site, completing its primary objectives, as outlined by the company earlier this year, of cleaning up the well and removing obstructions that have been preventing the well from flowing in advance of an extended well test.

Alan Minty, chairman of Nu-Oil, commented: "A key factor in achieving a successful completion of the first phase of the Work Programme is managing the difficult logistics and working environment in western Newfoundland.

"Although the programme is taking longer than originally forecast this does not diminish our confidence in, or commitment to, delivering this project. We remain confident of the successful conclusion of this first phase of operations and we look forward to announcing the results in due course."

He said negotiations with PVF Energy Services, which is undertaking the work and financing the project under a production sharing agreement announced in January, were continuing on the future development of the Garden Hill field, which Minty noted was a "legacy asset" that if talks are successfully concluded, "will provide the opportunity for NU-Oil to maximise its returns from the field".

In the meantime, management remains committed to focusing its resources on the acquisition of marginal field projects, in line with stated strategy.