Short Term Trading Week Starting: 18 Feb, page-38

Hi fedcba

A few years ago LNC held leases at Umiat. Absolutely there is oil there, lots of it and good quality, but the problem is it is near surface and the fields are low pressure.... meaning, to extract it there also needs to be gas found in conjunction which can be used to pressurize the fields. The LNC venture failed because they couldn't access gas. There is gas available in some places but not all. LNC also had problems with ice forming in the pipes which gummed them up very quickly. Another problem was the Canadian govt had to fund roads and pipelines which they only would do if LNC could have demonstrated they could effectively commercialize the Umiat fields. It all fell in a screaming heap.