TIDMFPM
RNS Number : 0846M
Faroe Petroleum PLC
26 July 2017
26 July 2017
Faroe Petroleum plc
("Faroe", "Faroe Petroleum", the "Company")
Successful Brasse sidetrack well results - increased volume
range
Faroe Petroleum, the independent oil and gas company focusing
principally on exploration, appraisal and production opportunities
in Norway, the UK and Atlantic Margin, is pleased to announce the
results of the 31/7-2S Brasse sidetrack appraisal well in the
Norwegian North Sea (Faroe 50% and operator, Point Resources
50%).
Highlights
-- Volume increase: recoverable resource volumes now estimated
at between 56 and 92 mmboe (from 43 to 80mmboe)
-- High net to gross: very high quality reservoir sands with a very high net to gross ratio
-- High quality light crude: similar quality crude to the nearby
producing Brage field (Faroe 14.3%)
-- Reservoir encountered close to prognosis: penetrated gross
hydrocarbon-bearing reservoir section with approximately 18 metres
of oil and 4 metres of gas in the sidetrack well
-- Attractive field development economics: field economics
robust at low commodity prices and with fast track potential
-- Faroe to progress as operator: work underway to take field to
development with first oil in 2020/21
The Brasse appraisal well sidetrack 31/7-2A has been drilled to
a total depth of 2,275 metres TVDSS, targeting the reservoir 1.0
kilometre to the west of the appraisal well (31/7-2 announced on 13
June 2017) and 2.4 kilometres to the south of the main discovery
well (31/7-1 announced on 16 June 2016). An extensive data
acquisition programme was carried out in the 31/7-2A sidetrack,
including the cutting of cores together with a full suite of
wireline logs and fluid samples. The sidetrack well successfully
penetrated the gas-oil contact and the oil-water contact in the
southern part of the Brasse field and encountered approximately 18
metres of gross oil-bearing and 4 metres of gross gas bearing
Jurassic reservoir above the oil water contact. Preliminary results
show that the well has encountered oil in a sand-rich reservoir of
very good quality with the same oil-water contact as in the
discovery well (31/7-1) and in the main bore of the appraisal well
(31/7-2). The pressure data indicates good pressure communication
within the reservoir.
Based on extensive data collected from the initial discovery
well, initial sidetrack, appraisal well (with drill stem test) and
the appraisal well sidetrack, the total gross volumes of
recoverable hydrocarbons for the Brasse field have been revised up
to 46-76 mmbbls of oil and 59-97 bcf of dry gas (56-92 mmboe in
aggregate).
The Brasse field discovery was made by Faroe in 2016 and is
located within tie-back distance to existing infrastructure: 13
kilometres to the south of the Wintershall-operated Brage field
platform, in which the Company holds a 14.3% working interest and
13 kilometres to the south east of the Statoil-operated Oseberg
Field Centre.
Extensive feasibility studies of the Brasse field development
have been carried out focusing on a sub-sea development solution
tied-back to either one of the hosts in the nearby area. This work
is ongoing and external studies have already been undertaken for
the joint venture for the Subsea Production System (SPS), flow
assurance and pipeline and marine work. Technical and commercial
activities related to the potential hosts were formally initiated
in Q4 2016. This work is ongoing and progressing according to plan
and in accordance with the regulations relating to the use of
facilities by others as set out by Norwegian authorities.
The preliminary reservoir development plan includes three to six
production wells and an optional water injection well for pressure
support. Initial flow rates from the prolific Brasse reservoir are
expected to be higher than previously thought, with predicted
delivery rates above 30,000 boe/d and first oil in 2020/21.
Based on the completed reservoir and feasibility studies,
preliminary total development capex has been estimated at c. $550
million for the mid-case development scenario consisting of four
wells and one subsea template.
Key project milestones going forward include the Final Concept
Selection and the submission of a Plan for Development and
Operations (PDO), both of which are planned for 2018.
The appraisal well will now be plugged and abandoned as
planned.
Graham Stewart, Chief Executive of Faroe Petroleum
commented:
"We are very pleased to announce the completion of this
successful, Faroe-operated, appraisal programme of the Brasse
field, which considerably exceeded expectations and further
confirms the commerciality of this discovery. The programme has
established excellent reservoir quality and reservoir
communication, together with excellent flow rates, even at the
periphery of the field. This new data has resulted in an increased
resource range to 56-92 mmboe and a substantial increase to flow
rate expectations.
"The Brasse field is clearly a very significant and valuable
asset, with very attractive economics even at long term low
commodity prices. The close proximity of the field to existing
competing infrastructure combined with its prolific reservoir
qualities and shallow water depth ensure this field can be
developed expediently, taking full advantage of the current low
cost environment.
"As an established E&P operator, Faroe is well equipped to
progress this important project and we look forward to providing
further progress updates in the coming months."
- Ends -
For further information please contact:
Faroe Petroleum plc Tel: +44 (0) 1224 650
Graham Stewart, CEO 920
Stifel Nicolaus Europe Tel: +44 (0) 20 7710
Limited 7600
Callum Stewart / Nicholas
Rhodes / Ashton Clanfield
BMO Capital Markets Tel: +44 (0) 207 236
Neil Haycock / Tom 1010
Rider / Jeremy Low
FTI Consulting Tel: +44 (0) 20 3727
Edward Westropp / Emerson 1000
Clarke
Andrew Roberts, Group Exploration Manager of Faroe Petroleum and
a Geophysicist (BSc. Joint Honours in Physics and Chemistry from
Manchester University), who has been involved in the energy
industry for more than 30 years, has read and approved the
exploration and appraisal disclosure in this regulatory
announcement.
The Company's internal estimates of resources contained in this
announcement were prepared in accordance with the Petroleum
Resource Management System guidelines endorsed by the Society of
Petroleum Engineers, World Petroleum Congress, American Association
of Petroleum Geologists and Society of Petroleum Evaluation
Engineers.
The information contained within this announcement is considered
to be inside information prior to its release, as defined in
Article 7 of the Market Abuse Regulation No. 596/2014, and is
disclosed in accordance with the Company's obligations under
Article 17 of those Regulations.
Glossary
"boe" barrels of oil equivalent
---------------------- -------------------------------
"boe/d" barrels of oil equivalent
per day
---------------------- -------------------------------
"Bcf" billions of standard
cubic feet of gas
---------------------- -------------------------------
"DST" drill stem test
---------------------- -------------------------------
"mmbbls" millions of barrels
---------------------- -------------------------------
"mmboe" millions of barrels
of oil equivalent
---------------------- -------------------------------
"preliminary resource preliminary quantification
estimate" of hydrocarbons estimated
to be potentially recoverable
from a known accumulation
---------------------- -------------------------------
"TVDSS" true vertical depth
subsea
---------------------- -------------------------------
Notes to Editors
The Company has, through successive licence applications and
acquisitions, built a substantial and diversified portfolio of
exploration, appraisal, development and production assets in
Norway, the UK and Ireland.
Faroe Petroleum is an experienced licence operator having
operated several exploration wells successfully in Norway and the
UK and is also the production operator of the Schooner and Ketch
gas fields in the U.K. Southern Gas Basin and the Trym and Oselvar
fields in the Norwegian North Sea. Faroe also has extensive
experience working with major and independent oil companies both in
Norway and in the UK.
The Company's substantial licence portfolio provides a
considerable spread of risk and reward. Faroe has an active E&A
drilling programme and has interests in a portfolio of producing
oil and gas fields in the UK and Norway, including the Schooner and
Ketch gas fields and the Blane oil field in the UK, and interests
in the Brage, Ringhorne East, Ula, Tambar, Oselvar and Trym fields
in Norway. In December 2016 the Company completed the acquisition
of a package of Norwegian producing assets from DONG Energy
including interests in the Ula, Tambar, Oselvar and Trym fields.
Full year average production for 2017, is estimated to be between
12,000-15,000 boepd. The investment programme to increase
production from the Company's existing fields continues, with the
planned installation of gas lift and drilling of two infill wells
on Tambar (Faroe 45%) and the recommencement of infill drilling on
the Brage field (Faroe 14.3%).
In November 2013 and March 2014 Faroe announced the Snilehorn
and Pil discoveries in the Norwegian Sea in close proximity to the
Njord and Hyme fields. More recently, in July 2016 the Company
announced the Brasse discovery, next to the Brage field, and the
Njord North Flank discovery, next to the Njord field, both in
Norway.
Norway operates a tax efficient system which incentivises
exploration, through reimbursement of 78% of costs in the
subsequent year. Faroe has built an extensive portfolio of high
potential exploration licences in Norway which, together with its
established UK North Sea positions provides the majority of
prospects targeted by the Company's sustainable exploration
drilling programme.
Faroe Petroleum is quoted on the AIM Market of London Stock
Exchange. The Company is funded from cash reserves and cash flow,
and has access to a $250million reserve base lending facility, with
a further US$100million available on an uncommitted "accordion"
basis. Faroe has a highly experienced technical team who are
leaders in the areas of seismic and geological interpretation,
reservoir engineering and field development, focused on creating
exceptional value for its shareholders.
This information is provided by RNS
The company news service from the London Stock Exchange
END
DRLEAFXSAEDXEAF
(END) Dow Jones Newswires
July 26, 2017 02:01 ET (06:01 GMT)
Faroe Petroleum (LSE:FPM)
Historical Stock Chart
From Mar 2024 to Apr 2024
Faroe Petroleum (LSE:FPM)
Historical Stock Chart
From Apr 2023 to Apr 2024