TIDMEME
RNS Number : 0410G
Empyrean Energy PLC
25 March 2022
This announcement contains inside information
Empyrean Energy Plc / Index: AIM / Epic: EME / Sector: Oil &
Gas
Empyrean Energy plc
Block 29/11, China - Rig Mobilisation and Anticipated Spud
Date
25 March 2022
Empyrean Energy plc ("Empyrean" or the "Company"), the oil and
gas development company with interests in China, Indonesia and the
United States, is pleased to provide the following update on
preparations to drill the Jade prospect at its 100% owned Block
29/11 permit, offshore China:
HIGHLIGHTS
-- The China Oilfield Services Limited ("COSL") owned NH9 drill
rig for drilling of the Jade well is being handed over to Empyrean
within the next few days for safety checks
-- Mobilisation of the NH9 rig to the Jade well drilling
location expected to be on or around 27 March
-- The Jade well is currently anticipated to spud on or around 2 April
Empyrean is the operator of Block 29/11 in China and has 100%
working interest during the exploration phase. In the event of a
commercial discovery, its partner, China National Offshore Oil
Company ("CNOOC"), may assume a 51% participating interest in the
development and production phase.
Following discussions with COSL and CNOOC to establish rig
availability, the recent completion of the well site survey and
receipt of all required permits, following the final well site
survey report, Empyrean advises that the mobilisation of the NH9
rig to the Jade well location is expected to occur on or around 27
March. NH9 had been used to drill a well for CNOOC immediately
preceding mobilisation to Jade.
COSL now estimate that the spud date for the Jade well will be
on or around 2 April 2022, depending on prevailing weather
conditions to ensure the safe anchorage of the NH9 rig at the Jade
location.
As previously advised, CNOOC EnerTech Drilling and Production Co
("CNOOC EnerTech") are providing comprehensive pre-drilling,
drilling and testing services to Empyrean for the Jade well. CNOOC
EnerTech has a wealth of global experience, but more importantly
has vast local hands-on experience managing the drilling of wells
within the Pearl River Mouth Basin where the Block 29/11 permit
sits. The Empyrean/ CNOOC EnerTech team will be present both
onshore, and offshore on the rig, during the drilling of Jade.
Offshore, the team will consist of a hand picked drilling
supervisor, well site geologist, mud logger and an electric logging
expert. Gaz Bisht, Empyrean's technical director who has a
successful track record of hydrocarbon discoveries within offshore
China, has already made his way to China and is supervising the
operations as part of the onshore team.
Empyrean and the CNOOC EnerTech team have taken every precaution
to plan for a safe drilling campaign at Jade. The COSL owned NH9
rig and its drilling team are 'drill fit' and the NH9 rig will be
mobilised straight to the Jade well location from its current
position without the need to go back to port.
From the spud date, the Jade well is anticipated to take
approximately 26 days to drill to Total Depth on a trouble free
basis. There are no overly challenging drilling zones anticipated
with the Jade well design and program. If the Jade well intercepts
a hydrocarbon zone, as anticipated, then testing is planned to take
approximately a further 2 weeks.
We will provide a further update on progress next week.
The Jade Prospect
The 2021 drilling campaign is targeting a world class
conventional oil target in the Jade Prospect, to which Gaffney
Cline & Associates ("GCA") assigned a Geological Chance of
Success ("GCoS") of 32%. Subsequent to this independent assessment,
the Company completed a gas cloud study and post stack seismic
inversion study that it believes further mitigates risk and
increases the GCoS to 41%.
The Jade Prospect has a GCA audited mean in place potential of
225 MMbbl and a P10 in place upside of 395 MMbbl. Four recent
nearby discoveries by CNOOC immediately to the West of the Jade
Prospect are filled to their P10 potential or better. All four
CNOOC discoveries have gas clouds showing in the overburden on
seismic.
Empyrean's excellent quality 3D seismic indicates that there is
a classic "fill to spill" geological setup in the basin, and a
robust regional seal, that provides the Jade and Topaz Prospects
with a very real possibility of being filled in a similar fashion
to nearby discoveries. The Jade and Topaz prospects both have gas
clouds, similar to nearby discoveries, in the overburden on 3D
seismic. Dry wells nearby do not have gas clouds. The Jade Prospect
is the first of the three identified prospects within Block 29/11,
which also contains the Topaz and Pearl prospects. The combined
audited mean in place potential of all three prospects is 884 MMbbl
and a P10 in place upside of 1,588 MMbbl. The post stack seismic
inversion study showed Jade and Topaz both have the potential for
excellent carbonate buildup reservoir quality with excellent
porosity and permeability. Any oil discovered is expected to be
light oil in the 38-41 API range, similar to nearby discoveries.
These attributes combined with the potential for exceptional
natural reservoir drive supports the potential for excellent
recovery rates.
The information contained in this announcement has been reviewed
by Empyrean's Executive Technical director, Gaz Bisht, who has over
31 years' experience as a hydrocarbon geologist and
geoscientist.
Empyrean CEO, Tom Kelly, stated:
"We are delighted that we are now days away from being ready to
spud one of the highest impact and exciting wells of 2022. Things
are getting very real for our team and we look forward to providing
shareholders and investors with further updates."
For further information please contact the following:
Empyrean Energy plc
Tom Kelly Tel: +61 6146 5325
Cenkos Securities plc (Nominated
Advisor and Broker)
Neil McDonald Tel: +44 (0) 131 220 9771
Pete Lynch Tel: +44 (0) 131 220 9772
First Equity Limited (Joint
Broker)
Jason Robertson Tel: +44 (0) 20 7330 1883
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END
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