AIM and ASX listed oil and gas group Range Resources (LON:RRL) this morning reported the initial results of an independent survey of its licences in the former Soviet state of Georgia. Range, which already has exploration an production operations in Texas, US and big hopes for drilling projects in the Somali state of Puntland, secured its Georgian licences in July 2009 in a move to diversify its portfolio. The latest findings from consultants at RPS Energy have produced a best estimate of gross undiscovered and unrisked oil-in-place across 68 structures on two blocks of 2.05bn barrels, with 1.025bn barrels attributable to Range.

The company said it had identified six ready to drill targets with gross oil-in-place of 728m barrels, of which 50% is attributable to Range plus cost recovery. Recovery factors for oil in place have been be conservatively estimated at 30%. Shares in Range responded with a 19.5% rise to 7.4p.

Oil seeps are widespread in Georgia, with exploration in the country having commenced during the 19th century, by exploitation of the surface seeps and shallow drilling beneath them. The first substantive discovery, the Supsa Field near the Black Sea, was made in 1889 and still produces small amounts of oil today. Georgia is a reasonably well established hydrocarbon producing province with a number of discoveries and seeps along the Greater Caucasus and Achara-Trialet frontal folds, which are present along the northern and southern margins of the two licenses, where there are numerous oil and gas seeps.

There have been a number small to medium discoveries to date, with the largest being the Samgori field, which was discovered in 1974 and has produced more than 165m barrels to date, with an estimated 200m barrels of recoverable reserves. The trend of oil discoveries in Georgia confirms the presence of a working hydrocarbon system that extends from Georgia into the Black Sea.

Range and Strait Oil & Gas, its 50:50 joint venture partner in the Georgian blocks, are understood to be finalising the mobilisation and drilling program. Last month, Range said that on receipt of the RPS report it would either progress the targets at the current 50:50 equity basis with Strait or look to finalise arrangements with potential farm-in partners to joint fund a drilling program whilst retaining a minimum 40% interest in the two…

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