TIDMEDR
RNS Number : 0321D
Egdon Resources PLC
22 October 2015
EGDON RESOURCES PLC
22 October 2015
("Egdon" or "the Company")
Wressle Oil and Gas Discovery: Update
Egdon Resources plc (AIM:EDR) is pleased to provide an update on
operations and plans for the Wressle oil and gas discovery located
to the east of Scunthorpe in Lincolnshire on licence PEDL180 where
Egdon operates with a 25% interest.
As announced previously, it had been the PEDL180 joint venture
(JV) partners' intention to undertake further well test operations
on both the Ashover Grit and Penistone Flags intervals. However,
since completion of the Extended Well Test ("EWT") operations in
early September 2015, the group has completed a detailed review of
the data gathered to date and are now sufficiently comfortable to
continue working towards compiling a field development plan ("FDP")
without requiring further time-consuming and costly testing
operations.
As previously reported, flow rates from the Ashover Grit
measured in the initial testing phase (80 barrels of oil per day
("bopd")) were affected by localised near well bore formation
damage (high "Skin" factor) and so are not representative of the
flow rates that could be attained from this interval. Reservoir
engineering analyses of the well test pressure and production data
indicates that initial production rates in excess of 500bopd could
be anticipated if the effects of the "Skin" can be successfully
countered. It is therefore the JV's intention that plans for the
development of Wressle will include a comprehensive suite of
operations and procedures, designed to mitigate the impact of the
"Skin" on production rates, which form part of the initial workover
programme for the well to prepare it for long-term production.
Egdon and the PEDL180 partners now plan to progress to an agreed
FDP for Wressle with a view to it being ready in Q1 2016 for
submission to the Oil and Gas Authority ("OGA") for approval. The
FDP will be compiled using drilling and test data from the well
together with reprocessed 3D seismic data to quantify the
developable resource volumes attributable to Wressle. In addition,
planning and permitting applications will also be required to be
submitted to North Lincolnshire Council and the Environment
Agency.
Production from Wressle is currently expected to be phased, with
initial development focused on the Ashover Grit oil reservoir.
Commenting on the update, Mark Abbott, Managing Director of
Egdon Resources said:
"We are delighted that the petroleum engineering and
geotechnical work conducted to date has given the PEDL180 joint
venture sufficient confidence to move directly towards FDP
preparation for Wressle, without further costly and time-consuming
testing. We are now focussed on delivering the required consents to
enable us to commence commercial oil production from the Ashover
Grit in H2 2016."
For further information please contact:
Egdon Resources plc
Mark Abbott, Jerry Field 01256 702 292
Buchanan
Richard Darby, Anna Michniewicz 020 7466 5000
Nominated Adviser and Broker - Cantor Fitzgerald Europe
David Porter, Sarah Wharry (Corporate Finance) 020 7894 7000
Richard Redmayne (Corporate Broking)
Joint Broker - VSA Capital Limited
Andrew Monk (Corporate Broking) 020 3005 5000
Andrew Raca (Corporate Finance)
Notes to Editors:
The Wressle Oil Discovery -The Wressle Prospect was defined on
proprietary 3D seismic data, which was acquired by Egdon in
February 2012. The structure is located on trend with the producing
Crosby Warren oil field and the Broughton-B1 oil discovery, both to
the immediate northwest, and the Brigg-1 oil discovery to the
immediate southeast. All contain oil in various different sandstone
reservoirs within the Upper Carboniferous succession. The pre-drill
gross mean Prospective Resources at Wressle, as calculated by
Egdon, were estimated to be 2.1 million barrels ("bbl") of oil.
This will be updated following a review of the drilling and test
data together with the results of the interpretation and mapping of
the re-processed 3D seismic data.
The Wressle-1 well reached a total depth (TD) of 2240 metres
measured depth (MD) (1814 metres true vertical depth below OS datum
(TVDSS)) on 23 August 2014. Elevated mud gas readings were observed
over large parts of the interval from the top of the Penistone
Flags reservoir target (1831.5 metres MD) to TD. The interests in
the Wressle-1 well are:
Egdon Resources U.K. Limited 25.00% (Operator)
Celtique Energie Petroleum Limited 33.33%
Europa Oil & Gas Limited 33.34%
Union Jack Oil plc 8.33%
The well was logged using measurement whilst drilling (MWD)
logging tools run on the drill string. Petrophysical evaluation of
the log data indicated the presence of potential hydrocarbon pay in
three main intervals;
-- Penistone Flags - up to 19.8 metres measured thickness (15.9 metres vertical thickness)
-- Wingfield Flags - up to 5.64 metres measured thickness (5.1 metres vertical thickness)
-- Ashover Grit - up to 6.1 metres measured thickness (5.8 metres vertical thickness)
On 9 February 2015, shareholders were updated on the successful
Ashover Grit Flow Test, which recorded flow rates of 80 barrels of
oil per day and 47 thousand cubic feet of gas per day during a 16
hour main flow period. No appreciable volumes of water were
observed. The oil is of good quality with a gravity of 39-40deg
API.
On 19 February 2015, shareholders were updated on the successful
Wingfield Flags Flow Test, which recorded flow rates of up to 182
barrels of oil per day of good quality 39-40deg API oil on free
flow, along with up to 456 thousand cubic feet of gas per day.
On 27 February 2015, shareholders were updated on the initial
successful Penistone Flags test, which produced gas at
facilities-restricted flowrates of up to 1.7 million cubic feet of
gas per day with associated oil of up to 12 barrels of oil per day
and no free water.
On 27 March 2015, shareholders were updated on the second
successful Penistone Flags test. Zone 3A in the Penistone Flags was
perforated over a 7.5 metre interval and produced good quality oil
with a gravity of 33(o) API. A total of 98.5 barrels of oil were
recovered during the test (of which flow induced by swabbing
operations produced 34.3 barrels of oil). This equates to a rate of
approximately 77 barrels of oil per day (bopd).
During the current EWT the Zone 3A perforations were produced
for a total of 254hrs over a 13 day period from the 5th to 17th
July 2015. Zone 3A was initially produced by sucker rod pump and
was then allowed to free flow to surface after the wellbore and
perforations had fully cleaned-up. Over the full 13 day period the
following separator cumulative volumes were produced: - 1,127
barrels ("bbl") of oil, 147 bbl of kill brine and 2,790 Mscf of
gas.
Operations at the Wressle site will not involve the process of
high volume hydraulic fracturing ('fracking') for shale gas.
Egdon Resources plc (LSE: EDR) is an established UK-based
exploration and production company primarily focused on onshore
exploration and production in the hydrocarbon-producing basins of
the UK and France.
Egdon currently holds interests in thirty four licences in the
UK and France and has an active programme of exploration, appraisal
and development within its balanced portfolio of oil and gas
assets. Egdon is an approved operator in both the UK and
France.
Egdon was formed in 1997 and listed on AIM in December 2004.
In accordance with the AIM Rules - Note for Mining and Oil and
Gas Companies, the information contained in this announcement has
been reviewed and signed off by the Managing Director of Egdon
Resources plc Mark Abbott, a Geoscientist with over 26 years'
experience.
Evaluation of potential recoverable hydrocarbons has been
assessed in accordance with 2007 Petroleum Resources Management
System prepared by the Oil and Gas Reserves Committee of the
Society of Petroleum Engineers (SPE) and reviewed and jointly
sponsored by the World Petroleum Council (WPC), the American
Association of Petroleum Geologists (AAPG) and the Society of
Petroleum Evaluation Engineers (SPEE).
This information is provided by RNS
The company news service from the London Stock Exchange
END
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