Highlands Natural Resources PLC Helios Two Drilling and Development Update (6747N)
28 October 2016 - 5:00PM
UK Regulatory
TIDMHNR
RNS Number : 6747N
Highlands Natural Resources PLC
28 October 2016
Highlands Natural Resources plc ('Highlands' or 'the
Company')
Helios Two Drilling and Development Update
Highlands Natural Resources, the London-listed natural resources
company, provides an update regarding the status of its two wells
in southeast Montana, which are part of the Company's Helios Two
prospect for natural gas and helium.
Eagle Well Update
Highlands drilled to a total depth of 3,047 feet on the second
Helios Two well called Helios 5-52-16-32 ('Eagle Well'). The well
was designed to test the Eagle Formation as a potential secondary
horizon following compelling initial data from the first Helios Two
well called Helios Well 5-52 16-22 ('Muddy Well').
The Highlands team was pleased to observe that the Eagle Well
produced a continuous natural gas flare of approximately 3 to 6
feet in height at surface without stimulation or fracking,
indicating a potentially significant natural gas resource.
Disappointingly, after logging the Eagle Well with a standard
logging tool used in open holes, the Company's contractor dropped
the tool back into the hole. Despite several retrieval efforts made
by the contractor, the logging tool remains unrecovered.
The Board, concerned by a risk of potential natural gas
accumulations at surface during retrieval operations, decided to
plug and abandon the well with the approval of Montana regulators.
On 27 October, 2016 the contractor agreed to provide Highlands with
a $75,000 credit on future operations and to bear the costs of
plugging the well, which has now been completed.
A second well is now being planned with fracture stimulation
treatments as originally intended for the plugged well, and
Highlands will update the market with additional details and timing
as plans mature.
Muddy Well Update
Following completion of water handling facilities, Highlands has
commenced de-watering operations at the Muddy Well. The well is
currently producing water at rates in line with Highlands'
modeling, which is a positive indication that de-watering the Muddy
Formation may be achieved. Highlands will update the market with
additional production data and gas analyses as soon as
practicable.
Chairman and CEO Robert Price said, "We prioritise the health,
safety and environmental considerations of our operations above all
else, which is why we elected to plug our Eagle well rather than
risk even the smallest chance of a natural gas-related accident at
the surface.
"Fortunately, the well's 'all-in' cost is relatively low in
comparison to Highlands' strong balance sheet following the
exercise of 30 million warrants, which brought GBP7.5 million into
Highlands' accounts over the past several months. Highlands remains
fully capitalised to carry out its various core projects including
de-watering the Muddy Formation, accelerating the commercialisation
of DT Ultravert, drilling a replacement Eagle Well, and developing
our East Denver Niobrara prospect.
"Positively, we have taken an important step forward on the
de-watering of our primary target, the Muddy Formation, and hope to
achieve natural gas and helium production as a result of
de-watering our initial Helios Two well. The continuous flare
observed in the Eagle Well is a further indication of prospective
resources under our 102,000+ acre position in southeast
Montana."
This announcement contains inside information
**ENDS**
For further information, please visit www.highlandsnr.com, or
contact:
Highlands Natural +1 (0) 303 322
Robert Price Resources plc 1066
Cenkos Securities +44 (0) 131 220
Nick Tulloch plc 9772
+44 (0) 131 220
9771 /
Cenkos Securities +44 (0) 207 397
Neil McDonald plc 1953
St Brides Partners +44 (0) 20 7236
Lottie Brocklehurst Ltd 1177
St Brides Partners +44 (0) 20 7236
Elisabeth Cowell Ltd 1177
Notes to Editors
Highlands Natural Resources (LSE: HNR.L) is a London-listed
natural resources company with a portfolio of high-potential oil,
gas and helium assets and technologies. The company's core projects
include:
-- DT Ultravert: a re-fracking and parent well protection
technology with 20 patents pending in the United States and
internationally. Highlands is advancing commercial conversations
with a range of oil and gas operators to create revenue-sharing
opportunities for DT Ultravert applications.
-- Helios Two: a 100,000+ acre helium and natural gas prospect
in SE Montana with drilling and assessment operations ongoing.
-- East Denver Niobrara: a farm-in opportunity for six
horizontal oil and gas wells targeting the Niobrara shale formation
in a well-studied area of the Denver Julesburg Basin.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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