Range ResourcesRRL

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Description:

Oil & Gas Exploration Company with projects in Puntland, Somalia, Former Soviet Union (FSU) territory of Georgia and Texas USA

Comment:

Range Resources currently has a 100% interest in the sole and exclusive rights to all mineral and hydrocarbon exploration and development in the Somali state of Puntland which covers an area of approximately 100,000km2.

• Potential replica of the 5 bn barrel of oil (bbl) - 10 bn bbl hydrocarbon basins in nearby Yemen. Competent Persons Report - Estimated Gross Oil in Place between 2.2 bn bbl -10.4 bn bbl on one of the two onshore basins (Nogal)
• 80% farm-in agreement (4 wells) with Africa Oil Corp. (TSXV:AOI) on two onshore basins (Nogal and Dharoor). US$30m spent to date

KEY FACTS: Somalia

Puntland has been recognised as a pluralistic autonomous state since 2001; and is recognised by the Transitional Federal Government of Somalia. Range has a constructive relationship with new Government and current PSA's (Acts of Puntland Parliament) in force.

The Political situation in Puntland is comparatively stable, hence it has not been affected by the political uncertainties in southern Somalia.

2009 Work Programme: Somalia

• Africa Oil has completed reviews of extensive data collected by Puntland Government and Range Resources including reprocessing and reinterpreting seismic tapes
• Ready to drill targets (Nogal Valley) identified with contractor selected. Nogal to be drilled after Dharoor Valley
• 900km 2D seismic programme for Dharoor Valley was completed December 2008
• Rig mobilisation for Dharoor planned for 4th quarter of 2009. Minimum of 2 wells. Final stages of Government Africa Oil sign off.
• 2D offshore seismic to be agreed with Puntland Government in 2009

Georgia: Overview

Georgia is an oil and gas producing country with numerous documented discoveries, including the Samgori Field with approximately 200 million barrels of recoverable reserves. Heads of Agreement entered into Strait Oil & Gas Ltd to acquire 50% interest in 2 oil and gas blocks in the central portion of the Republic of Georgia (Blocks VIA and VIB); this interest costing an approximate US$5m.

The Blocks comprise a contiguous area of 7,000 sq km (approximately 10% of the surface area of the country) subject to significant exploration during the Soviet era, with 14 prospects having been identified on Block VIA alone. These provide a gross unrisked potential totaling more than 380 million barrels. Drilling depths are relatively shallow at an expected range of 2000-3000 meters.

They have acquired 2D seismic data in order to refine earlier mapping and get prospects to a drillable state. To earn it 50% interest Range will complete Phase II under the relevant Production Sharing agreement (PSA) applicable to the Strait Blocks which will consist of 350km2 of 2D and 3D seismic and well selection - budget costs circa US$4-5m.

The Agreement is initially a 50:50 production split.

US Strategic Asset-September 2009

Range acquires a 25% interest in well known Texas oil and gas field, with drilling at project already underway,

• Low entry cost - To fund drilling of Smith #1 Well (AUD$1m) and in the event of a discovery fund costs to production (AUD$350,000),
• Significant infrastructure in place and timing to first sales will be approximately three months upon a discovery being made, with an estimated payback period of 8 - 10 months.M

North Chapman Ranch Background

North Chapman Ranch is situated within the prolific Frio producing trend just north of the Chapman Ranch in the Mobil David and Doughty Fields. The Mobil David field was discovered in 1965 when Mobil drilled the Chapman #1B and completed the well in the Laureles Sand (now the Howell Hight). Since then, an estimated 250 billion cubic feet of natural gas and more than 10 million barrels of oil have been produced from this field.

Recently, several operators in the area have been successfully developing the deeper Howell Hight formation, with some wells exhibiting flowrates in the 6-9 million cubic feet per day range. They are currently drilling Smith #1 well is programmed to test the Howell Hight formation in a location near that of the recently drilled Zdansky #1 well. However, Crest was unable to complete the Zdansky well due to hole problems.

If successful, the Smith #1 well could trigger significant oil and gas production and development drilling with very attractive economics, at a time when exploration and development costs in the U.S. have dropped dramatically. In addition, the favorable operating and regulatory environment in Texas serves to mitigate perceived political risk associated with Range's other international exploration projects.

Moving Forward

With Range anticipating that Africa Oil and the Puntland Government will agree to the proposed drilling programme on the onshore Puntland oil & gas blocks shortly, the recently acquired Georgian blocks being prepared for a seismic survey and the Smith #1 well about half way to target depth. The Company is excited with its portfolio and the activity planned for the coming months.