GLR Galileo Resources Plc

RNS No 8855n
GAELIC RESOURCES PLC
27th October 1998


                       GAELIC RESOURCES PLC ("Gaelic")                        
                                                                              
                             INTERIM REPORT 1998                              

Drilling will commence shortly in Portugal with Aljubarrota No 2 due to spud
in November 1998.

Gaelic, through its wholly owned subsidiary, European Hydrocarbons Limited,
holds or is earning a 25% interest in five Portuguese Licences: Figueira da
Foz, Marinha Grande, Aljubarrota, Sao Pedro De Muel and Sao Mamede.  The first
well in which Gaelic participated, Aljubarrota No 1, was completed in February
1998 and a report on the results was given in the Annual Report published in
June 1998.  The well found oil and gas shows in the dolomitic beds of the
Dagorda Salt Formation, the secondary target, but the primary target of
Triassic Silves Formation sandstones was absent.  Several drill-stem tests
were carried out on the dolomites but they failed to produce any flows of oil
or gas, possibly due to formation damage.  The well was temporarily abandoned
pending the drilling of a second well but could be re-entered for further work
to be carried out.

The oil and gas shows found in Aljubarrota No 1 indicate that a petroleum
system does exist in the area with the Dagorda Salt Formation trapping oil and
gas which has been generated from deeper Palaeozoic source rocks.  This has
encouraged the selection of a second target in the area for drilling.

Well Aljubarrota No 2 is scheduled to spud in November 1998.  A site has been
prepared and a drilling rig has been contracted.  The well will test a new
geological structure defined by seismic surveys which lies about 9 kilometres
to the south east of Aljubarrota No 1.  It has a reserve potential in the
range 1 to 4 TCF.  The well is scheduled to take 67 days to reach terminal
depth.  It is planned to limit formation damage, due to prolonged exposure to
drilling mud, of any oil or gas-bearing dolomites that might be found by
carrying out immediate open-hole drill-stem testing during drilling.  If
successful the dolomites would then be cased-off before drilling onwards to
the primary sandstone target.  The Aljubarrota No 2 geological structure is
interpreted to lie closely adjacent to an area of Palaeozoic source rocks and
to have a thick Silves Formation developed which should contain porous
sandstones.

There are many more similar targets in the extensive licensed area.  These
have the potential to contain commercial oil or gas fields and could be
drilled should results from this well be encouraging.  The main Portuguese gas
pipeline runs closely adjacent to the area of operations.

Following a recent private placing of Stg#1 million at Stg1.25p per share the
company is sufficiently well funded to participate in this programme.

The increased loss for the period arises from additional administration costs
due to the increase in Gaelic's exploration activities described above and the
amortisation of Goodwill which arose on the acquisition of European
Hydrocarbons Limited last year.

W.I.L. FORREST
Chairman

                                                                              
                                                                              
                UNAUDITED CONSOLIDATED PROFIT AND LOSS ACCOUNT                
                    for the six months ended 30 June, 1998                    


                                               6 mths to   6 mths to
                                                 30/6/98     30/6/97
                                                     IR#         IR#

Turnover                                              -           -

Cost of Sales                                         -           -
                                             ----------- -----------
Gross Profit/(Loss)                                   -           -

Administration expenses                        (158,683)    (88,833)
Amortisation of Goodwill                       (122,806)          -
                                             ----------- -----------
Operating Loss-Continuing Operations           (281,489)    (88,833)

Interest Receivable & Similar Income             39,973         101

Interest Payable & Similar Charges               (1,355)        (76)

Foreign Exchange gains - net                     25,375           -
                                             ----------- -----------
Loss on ordinary activities before taxation    (217,496)    (88,808)
Tax on Ordinary Activities                          (21)          -
                                             ----------- -----------
Loss for the financial period                  (217,517)    (88,808)
                                             =========== ===========
Loss per Ordinary Share                        IR(0.03)p   IR(0.03)p
                                             =========== ===========

Copies of this report are being sent to shareholders and are available to the
public at the Company's registered office: 7 Priory Hall, Stillorgan, Co.
Dublin. 

For further information please contact:

David Quick
Tel: (00 44) 1684 892 242

27 October, 1998


END

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