San Leon Energy is pleased to announce that it has signed a Memorandum of Understanding ("MoU") with the Office National des Hydrocarbures et des Mines ("ONHYM") in Morocco, granting San Leon exclusive rights to a 36 km(2) Block in the Timahdit Oil Shale Deposit for two years to evaluate the commercial viability of a surface retorting (process yielding shale oil through pyrolysis and vapor condensation) project on the prolific Timahdit oil shale deposits. Timahdit's shale oil yield in the awarded area is considered to be the highest in Morocco with an average of 99 l/t in the rich layers and has significantly less moisture content than many other international oil shale deposits.
Recent analysis by Enefit OutotecTechnology ("EOT", see also www.enefit.com/eot) has confirmed that the Timahdit oil shale has commercial potential using Enefit's surface retorting process and further raw shale oil upgrading. As a result of low moisture content in the Timahdit shale, the oil project will have an output capacity for power generation as a side product.
EOT has completed an Initial Evaluation Study using historical exploration data to evaluate the commercial potential of exploiting Timahdit oil shale using the Enefit280 plant design, which processes up to 280 tons of oil shale per hour. The study considers an initial Enefit retorting unit producing 3,600 BOPD of raw shale oil. Two additional Enefit units could be added to increase production up to 11,000 BOPD, and would include synthetic oil upgrading and power generation facilities.
As a result of the positive results of the initial evaluation of the Timahdit oil shale, and San Leon's successful award of the Timahdit Oil Shale Block, San Leon and EOT have agreed to extend the scope of their existing cooperation to cover the Timahdit concession. The companies plan to select a large sample of the Timahdit oil shale for extensive evaluation in EOT's laboratories in Frankfurt, Germany. In the meantime both companies continue to progress the extensive engineering and commercial analysis required to make Timahdit oil shale a reliable energy resource for Morocco.
Executive Chairman, Oisin Fanning commented:
"We are excited by the award of the Timahdit oil shale area to San Leon and the extended cooperation with EOT. Based upon the results of the recent analysis by EOT and current oil prices we are committed to a feasibility study evaluating the commercial potential of the Timahdit oil shale. San Leon's continued investment in Morocco is supported by the Company's ongoing cooperation with ONHYM and the Morocco government. Timahdit demonstrates San Leon's commitment to establish a major shale oil project in Morocco."
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