TIDMPPC
RNS Number : 5335G
President Energy PLC
26 November 2020
26 November 2020
PRESIDENT ENERGY PLC
("President" or the "Company")
Testing success at well LB-1, Las Bases Field
Proven production from the previously undrained Centenario
formation
President Energy (AIM: PPC), the energy company with a diverse
portfolio of production and exploration assets, announces testing
success at the old shut-in well, LB-1, Las Bases field, Rio Negro,
Argentina.
Key points
-- Workover and testing of the shallow Centenario interval in
the old shut-in well, LB-1 was a follow-on from the successful
newly drilled well LB-1001
-- Gas freely and continuously flowed to surface in commercial
quantities during test at choke sizes ranging from 4mm to 16mm
-- Potential to materially increase production by performing artificial stimulation
-- This represents the first time any hydrocarbons have been
tested and flowed by President from this previously undrained
Centenario interval within its concession areas
-- The commercial production of the shallow Centenario opens up
the potential to cost effectively drill this prevalent shallow
interval elsewhere in the Company's licences
-- Centenario formation will make a positive addition to
President's end of year reserves (no reserves of any category
currently booked for the formation)
-- The well will be placed on production before the year end
Las Bases LB-1
On 26 October the Company announced that, as a result of the
success of the newly drilled LB-1001 at the Las Bases field, Rio
Negro Province, there was potential for a workover, perforation and
testing of the shut-in well LB-1 to initiate, in the words of the
announcement "new previously untapped gas production".
LB-1 was drilled originally by Chevron and was a prolific
producer of gas from deeper sections which subsequently watered
out. It has been shut-in for several years, however, the results of
LB-1001 highlighted the potential of gas production from a
shallower, younger Cretaceous sand interval known as the Centenario
at a depth of approximately 950 metres.
No commercial production by President or its predecessors in
title has ever been seriously attempted from this interval which
had in effect been bypassed and ignored. Accordingly, no reserves
have ever been booked by President in respect of this interval
despite the fact the Centenario Formation is prevalent at these
shallow depths in the Las Bases, Puesto Prado and Estancia Vieja
fields.
It is this sand body of approximately 7 metres (23 feet) which
has now been tested. After perforation and an acid treatment to the
interval the well flowed freely and continuously to surface through
choke sizes varying from 4mm to 16mm with little or no water. On
termination of the testing, pressure built up to original pressure
within one hour suggesting inter alia good reservoir production
qualities.
It is considered that, on production, this interval without
further stimulation will initially flow, steady state, at
approximately 21,000 M(3) /d (120 boepd). It is expected that this
would increase materially with a hydraulic or further acid
artificial stimulation due to what could be a tighter form of
reservoir rock in this interval. In this regard, the rock
properties and dynamic reservoir data will now be analysed and
reviewed during the initial stages of production. A positive and
important feature is the fact that on the logs there does not seem
to be an identifiable oil / water contact nearby.
Work has now commenced on subsurface mapping of this interval
across President's licence acreage. Whilst it is premature to say
more, it is already clear that this result is a potential play
opener at least in the Las Bases field and in any event it will
make a positive addition to President's end of year reserves.
The cost of the workover is estimated on budget at a modest
US$350,000 and the well will be placed on production before year
end.
Peter Levine, Chairman, commented
"This is an encouraging result.
"Whilst in the context of our growing Group production, the
expected pre-year end initial production can be said to be more
incremental than material, the testing success has a potential
impact of somewhat greater significance.
"Taking into account the now proven produceability of the
reservoir, the shallow depth thereby meaning modest costs for
drilling new wells, the potential to materially upscale production
levels by artificial stimulation and in particular the prevalence
of this Centenario interval over areas in our Concessions, it is a
potentially new play opener in at least Las Bases and perhaps
others of our Rio Negro fields.
"Accordingly, this result following on from the two successful
drilled wells in the last two months, demonstrates the continued
potential for organic growth in our onshore short cycle, high
return conventional oil and gas assets as well as the maturing
capability of our teams in handling multiple work streams
simultaneously.
"Step by step may seem a trite expression but it underlines the
clear and obvious positive rate of climb that President is
achieving in its business."
Dr Martin Gee, PhD in Geophysics (Oxon), BSc (First Class hons)
in Earth Sciences (Cardiff) who meets the criteria for qualified
persons under the AIM guidance note for mining and gas companies,
has reviewed and approved the technical information contained in
this announcement.
Glossary:
Boepd means barrels of oil equivalent (oil and gas) per day
LB means a well in Las Bases field, Rio Negro Province,
Argentina
M(3) /d means cubic metres of production of gas or oil as the
case may be
Contact:
President Energy PLC
Rob Shepherd, Group FD +44 (0) 207 016 7950
Nikita Levine, Investor Relations info@presidentpc.com
finnCap (Nominated Advisor)
Christopher Raggett, Charlie Beeson +44 (0) 207 220 0500
Shore Capital (Corporate Broker)
Jerry Keen, Antonio Bossi +44 (0) 207 408 4090
Notes to Editors
President Energy is an oil and gas company listed on the AIM
market of the London Stock Exchange (PPC.L) primarily focused in
Argentina, with a diverse portfolio of operated onshore producing
and exploration assets.
The Company has operated interests in the Puesto Flores,
Estancia Vieja, Puesto Prado and Las Bases Concessions, and
Angostura exploration contract, all of which are situated in the
Rio Negro Province in the Neuquén Basin of Argentina and in the
Puesto Guardian Concession, in the Noroeste Basin in NW Argentina.
Alongside this, President Energy has cash generative production
assets in Louisiana, USA and further significant exploration and
development opportunities through its acreage in Paraguay and
Argentina.
The Group is also actively pursuing value accretive acquisitions
of high-quality production and development assets capable of
delivering positive cash flows and shareholder returns. With a
strong strategic and institutional base of support, including the
international commodity trader and logistics company Trafigura, an
in-country management team as well as the Chairman whose interests
as the largest shareholder are aligned to those of its
shareholders, President Energy gives UK investors access to an
energy growth story combined with world class standards of
corporate governance, environmental and social responsibility.
This announcement contains inside information for the purposes
of article 7 of Regulation 596/2014
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