TIDMNTOG
RNS Number : 6804W
Nostra Terra Oil & Gas Company PLC
21 August 2015
AIM: NTOG 21 August, 2015
Nostra Terra Oil and Gas Company plc
("Nostra Terra" or the "Company")
Quarterly Production and Operations Update
Quarterly production increase of 112% over same quarter last
year
Nostra Terra (AIM:NTOG), the oil and gas exploration and
production company with a growing portfolio of assets in the USA,
is pleased to provide an operational and production update for the
second quarter of 2015.
Highlights
-- Quarterly production increase of 112% over same quarter last year
-- Quarterly production of 8,663 boe (net of royalties)
-- Quarterly revenues reached US$319,219 (net of royalties)
-- Exploratory investment in South Texas, Eagle Ford trend
-- Expansion in Wyoming, PawPaw Prospect
Monthly Production (Net)
Month Total Net* Production Revenue (USD)
(BOE)
------- ---------------------- --------------
April 3,140 $109,520
------- ---------------------- --------------
May 2,827 $101,499
------- ---------------------- --------------
June 2,696 $108,200
------- ---------------------- --------------
*Net to Nostra Terra's working interests, after royalties
(NRIs range from 78% to 81%)
Q1 2015 Operations Update
The continuing low oil price environment in the second quarter
brought both challenges but also opportunities to invest. Many
operators in the USA have taken the view that it is better to
receive a higher return for their investment when oil prices
recover, as many experts have forecasted for later this year. This
obviously has an impact on Nostra Terra as regards to the prospects
where we don't operate, such as Chisholm Trail and High Plains.
However, at the same time this environment is delivering new
opportunities to invest at much more attractive levels than last
year.
Despite the challenges faced and the lowest oil prices since
2009 we continue to receive a return on our production portfolio
with 8,663 barrels of oil equivalent sold in the second quarter
bringing in US$319,219 of revenue.
Chisholm Trail Prospect (Oklahoma)
Multiple formations have been drilled and successfully tested.
Economics for existing horizontal wells remain positive, however
operators have significantly slowed down drilling in 2015. Because
high percentages of production are obtained in the first several
months, the Company believes it is better to wait for higher oil
prices than to produce relatively large volumes at lower prices.
Nostra Terra will continue to evaluate new proposals as they are
made by operators.
White Buffalo (Wyoming)
We have very good lease terms with White Buffalo, our
exploration play, which mean that we have the luxury of being able
to wait for more favourable oil prices before investing money and
time into the project. As indicated above, the environment for
investment in drilling has fallen since the collapse in the oil
price. We also don't want to sell much of the potential oil from
this prospect at these prices, when many experts are predicting
rising oil prices in the near future. We see a better use of our
resources at the moment, in investigating assets which are very
compelling economically at these depressed prices. As the oil price
and the appetite for investment in new wells recover, we will
increase our workload on this prospect.
South Texas (Eagle Ford Trend)
Earlier this year Nostra Terra announced the investment in a 1%
Working Interest in two prospects, San Miguel and Don Pedro. The
small interest was subscribed as a preliminary commitment with
minimal cost, reserving the possibility of increasing the Working
Interest pending results.
Each of the Prospects have been drilled and completed. The wells
have been swab tested and surface equipment has been installed.
Production figures will be reported as soon as the figures become
available from the operator.
Paw Paw Prospect (Wyoming)
We completed Farm Out negotiations for the Paw Paw Prospect from
Koch Exploration in July of this year. The prospect is based on
analysis of 3D seismic which indicated that a fault closed feature
exists along a fault trend in Big Horn County, Wyoming. The
Prospect is considered to be directly analogous to the Enigma Field
which has produced a cumulative total of 3.6 million barrels of
oil.
Haas Engineering (third-party reservoir engineer) has projected
that the potential resource of the leased acreage could be as much
as 7.368 million barrels of oil from primary and secondary
recovery.
As previously announced, Nostra Terra is progressing this
prospect towards drilling through: Wyoming licensing for
operations, negotiations with drilling and completion contractors,
creating an Exploration Unit, state and Federal permitting, and
discussions with other exploration and production companies that
could potentially acquire interests in the prospect.
Outlook
The concentration remains on areas of "stacked pay" and will be
acutely focused on investing where the economics are strong,
despite the lower current oil prices. We are particularly
interested in assets that are already producing, or are drilling,
or drill-ready immediately. We are seeing an increasing number of
potential assets available for acquisition and anticipate that will
continue as the markets adjust to lower commodity prices.
Matt Lofgran, Chief Executive Officer of Nostra Terra,
commented:
"During the Second Quarter the two most significant events for
the Company were bringing on a new Chairman with extensive industry
and exchange experience, and signing of an agreement with Koch
Exploration, a subsidiary of the second largest private company in
the USA. While we believe these two events can have a very positive
effect for shareholders it should also signal to others the
strength and ambition to grow the Company and drive shareholder
value in the future.
We will continue to seek out opportunities to grow the company
during this time of lower asset value while keeping overheads
low."
The technical information within this announcement has been
reviewed by Alden McCall, the Company's Chief Operating Officer, a
Certified Petroleum Geologist and a member of the American
Association of Petroleum Geologists and the Society of Petroleum
Engineers.
Glossary
`boe' means barrels of oil equivalent: a unit of energy based on
the approximate energy released by burning one barrel (42 US
gallons or 158.9873 litres) of crude oil.
`boepd' means barrels of oil equivalent per day
'mcfd' means Thousand Cubic Feet per Day
'NRI' means Net Revenue Interests
'WI' means Working Interest
For further information, visit www.ntog.co.uk or contact:
Nostra Terra Oil and Gas Company plc
Matt Lofgran, CEO
mlofgran@ntog.co.uk Telephone: +1 480 993 8933
Sanlam Securities UK Limited
(Nominated adviser and broker)
Lindsay Mair / James Thomas / Jamie Vickers Telephone: +44 20 7628 2200
Walbrook PR
Gary Middleton Telephone: +44 207 933 8797
This information is provided by RNS
The company news service from the London Stock Exchange
END
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