TIDMADV
RNS Number : 4996M
Advance Energy PLC
22 September 2021
22 September 2021
Advance Energy plc
("Advance Energy" or the "Company")
Buffalo Project Update
Advance Energy ( AIM:ADV ), the energy company seeking growth
through acquisition or farm-in to non-operated interests in
discovered upstream projects, is pleased to provide an update on
the Buffalo project offshore Timor-Leste (the "Buffalo Project")
ahead of the drilling of the Buffalo-10 well.
Highlights:
-- Buffalo-10 well on schedule to spud in early November 2021
-- Shallow water depth of 30 metres, with reservoir depth between 3,200-3,300 metres
-- Mid case recoverable volume estimate is 34 million barrels
(gross, 2C contingent resource) in the Buffalo field
-- Buffalo-10 considered by RISC Advisory to have an 85%
probability of confirming a sanctionable development project based
on the minimum economic field size
-- Buffalo-10 to be retained as first production well in development program
-- Discussions underway to seek to facilitate accelerated first production
-- Equipment currently being mobilised for drilling
The Buffalo Project, in which Advance Energy holds a 50% working
interest, involves the redevelopment of the Buffalo oil field in
the Timor Sea. The field resides in only 30 metres of water, with a
reservoir depth between 3,200 and 3,300 meters below the sea
bed.
The previous BHP Buffalo development, of 20 years ago,
demonstrated the existence of a very high deliverability reservoir
containing high quality light oil that is expected to sell at a
premium to Brent in today's market.
Carnarvon Petroleum Limited (ASX:CVN) ("Carnarvon"), as the
operator of the Buffalo Project, is preparing to drill a well that
will penetrate the remaining oil column (confirmed from when the
field was still producing at the time of shut-in in 2004), and
assess the extent of the revised mapped attic oil column.
RISC Advisory have certified the mid case recoverable volume in
the Buffalo field to be 34 million barrels (gross, 2C contingent
resource). Further, given that the RISC Advisory certified 1C
resource of 16 MMstb is economic down to an oil price of US$35/bbl,
it is considered that there is a strong likelihood that the
Buffalo-10 well will confirm an economic development project.
Accordingly, Carnarvon's drilling plans provide for the Buffalo-10
well to be retained as the first production well in a wider
redevelopment program.
In light of the perceived likelihood of an economically viable
redevelopment project, the joint venture of Carnarvon and Advance
Energy are also working on plans to compress the timeline to first
production once the Buffalo-10 well confirms the expected
recoverable oil resource. These plans include engaging with
industry for supply and installation of suitable equipment to
produce the oil.
As announced on 2 September 2021, the VALARIS JU-107 drilling
rig has been contracted to drill the Buffalo-10 well. The rig will
move to the Buffalo drilling site once it has completed its current
operations which are around 300 kilometres from the Buffalo
location, with Buffalo drilling operations expected to commence in
early November 2021. A site survey of the anticipated surface
location has been undertaken, with confirmation that the location
is suitable for the jack-up drilling rig.
Aside from the drilling rig, a number of ancillary contracts
have now been signed with support vessels, helicopters, drilling
service providers and shore base and logistics providers. Equipment
is being mobilised in preparation for drilling to commence within a
few weeks.
While the majority of support services for the drilling have
been confirmed, the final well timing will be subject to the
release of the rig from the previous operator, securing the last
remaining services and equipment, and receiving the necessary joint
venture and regulatory approvals.
Leslie Peterkin, CEO of Advance Energy, commented:
"Advance Energy is pleased to note from that everything is on
track for the Buffalo-10 well to spud in early November. As noted
in this update, the joint venture has been working hard to ensure
everything is lined up to enable the safe drilling of this material
well for the Company. The joint venture is confident of Buffalo-10
being both a geological and economic success, and is therefore
laying the groundwork to bring the field into production on an
accelerated timeline. We look forward to providing a further update
to confirm that the rig is in transit to location in due
course."
Enquiries:
Advance Energy plc +44 (0)1624 681
Leslie Peterkin (CEO) / Stephen West (CFO) 250
Strand Hanson Limited (Financial and Nominated
Adviser) +44 (0)20 7409
Rory Murphy / James Harris/ James Bellman 3494
Buchanan (Public Relations) +44 (0)20 7466
Ben Romney / Jon Krinks 5000
Tennyson Securities Limited (Joint Broker) +44 (0)20 7186
Peter Krens / Ed Haig-Thomas 9030
Optiva Securities Limited (Joint Broker) +44 (0)20 3411
Christian Dennis 1881
For further information, please visit www.advanceplc.com and
@advanceplc on Twitter
To register for Advance Energy's email alerts, please complete
the following form:
https://www.advanceplc.com/media-centre/news/#alerts
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014 as it forms part of
United Kingdom domestic law by virtue of the European Union
(Withdrawal) Act 2018.
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