Linc Energy Limited (ASX:LNC) Commences Enhanced Oil Recovery with Injection of CO2 in Wyoming

Brisbane, Nov 23, 2011 AEST (ABN Newswire) - Linc Energy Ltd (ASX:LNC) (OTCQX:LNCGY) is pleased to announce that it is taking aggressive steps to introduce EOR in its Glenrock, Wyoming oil fields with the commencement of CO2 injection into its first well.

Following the receipt of all necessary permits from the Wyoming Department of Environmental Quality, Linc Energy has contracted Praxair to inject 500 tonnes of liquid CO2 into the South Glenrock B Unit #34 well. Well preparation work has commenced including the installation of a new liner to ensure injection integrity.

Praxair has staged seven (7) 60 tonne CO2 bullet storage tanks at the well site and the tanks are being filled via truck from the Praxair Walden, Colorado facility. CO2 will be delivered from the bullet tanks through a manifold system, heated to approximately 60 degrees Fahrenheit then pumped at high pressure down-hole at an anticipated one to three barrels per minute rate. The final rate will be determined on site during the operation to ensure a maximum pump rate without exceeding the well fracture gradient.

Once injection is completed the well is allowed to "soak" for 19 to 21 days and the CO2 is allowed to disperse in the reservoir. The well is then flowed back to tanks on location and the oil, water and CO2 is separated. A similar program was conducted in the South Glenrock B Unit in 1991 in which 250 tons of CO2 was injected. A pre-injection production rate of 13 barrels of oil increased to approximately 50 barrels of oil per day following injection. Production over the baseline rate was sustained for nearly 6 years and an incremental 12,000 barrels of oil were produced.

"The Glenrock assets have produced over 140 million barrels of oil under traditional drilling. Now it is time to introduce EOR with CO2 injection and secure the remaining barrels in reserves that still exist in these fields," Linc Energy Chief Executive Officer, Peter Bond, said.

In February 2011, Linc Energy acquired the Big Muddy, South Glenrock, and South Cole Creek oil fields near Glenrock, Wyoming from Rancher Energy Corporation. Current oil production from the fields' four operating units totals approximately 215 barrels per day.

The South Glenrock and Big Muddy fields have both been analysed by Nitec LLC (Nitec) an experienced third party engineering firm in Denver Colorado, which determined that carbon dioxide (CO2) flooding could potentially produce in excess of 10,000 barrels per day from each of these fields. Nitec has been reengaged by Linc Energy to work with our own EOR team to evaluate the South Glenrock B Unit for varying volumes of CO2 to allow the Company to begin a CO2 flood with lower initial volumes, ramping up to a larger scale in the future.

In addition, Linc Energy has contracted Nicolas Consulting Group of Midland Texas to finalise the Front End Engineering and Design (FEED) study for the facilities (production and recycle compression) for the Glenrock CO2 EOR project.

Wood Group PSN has been contracted to prepare the Glenrock field for construction. Wood Group is performing an "as-built" survey. From the survey, Wood Group will utilise existing Rights of Way for new construction activities to help minimise new surface disturbances. Also, Wood Group is developing a Project Execution Plan, due in January 2012, for the field development to ensure the proper materials and equipment are installed while providing supporting documentation.

Linc Energy has executed an Engineering Services Agreement with Rocky Mountain Power to evaluate and provide preliminary engineering and construction cost estimates for the power infrastructure improvements necessary for well site, production and recycle facilities required. Scope deliverables are due January 2012.

"South Cole Creek, the smallest of the three producing fields, has a cumulative production of over 17 million barrels but has yet to be evaluated for EOR. However the EOR process typically prolongs the life of each producing zone by over 30 years," Mr Bond said.

Planning, engineering and permitting are underway for introduction of CO2 for EOR at the South Glenrock B Oil Field, and will begin in the Dakota formation before the end of 2011.

This formation will be the first of nine separate potential stratigraphic zones identified for EOR using CO2 injection.

The CO2 will initially be delivered to the field by trucks until a pipeline is built to provide long term dependable supplies and maintain lower operating costs.

Initial injection rates of up to seven million cubic feet per day (MMCFD) will increase to over 30 MMCFD as the CO2 injection infrastructure is developed and installed in the oil field.

Contact

Heather Stewart Media Manager Phone: +61-7-3229-0800 E-mail: heather.stewart@lincenergy.com ASX Contact: Brook Burke Company Secretary Phone: +61-7-3229-0800 E-mail: brook.burke@lincenergy.com Information for Investors: Justyn Peters General Manager Investor Relations Phone: +61-7-3229-0800 E-mail: justyn.peters@lincenergy.com